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Full text of "ANNUAL REPORT - ONTARIO ENERGY BOARD (fiscal year ended March 31, 1988)"

Table of Contents Table de Contents 

Tra n sm i tta I Lette r 1 

Lettre de transmission 

Introduction 2 

Introduction 

Scope of Operations 3 

Apercu des activites 

Organizational Structure 9 

Structure organisationnelle 

The Public Hearing Process 10 

Audience publiques 

List of Activities 1 4 

Liste des activites 

Review of Selected Activities 1 7 

Resume des activites 

Glossary of Terms 38 

Lexique 




To the Honorable Lincoln M. Alexander 
Lieutenant Governor of the Province of 
Ontario: 



I hereby submit the annual report of the 
Ontario Energy Board. It reviews the events 
and activities of the fiscal year 1 987-88: 



A son honneur Lincoln M. Alexander 
Lieutenant-gouverneur de la province 
I'Ontario: 



de 



Respectfully submitted, 



J'ai I'honneur de presenter le rapport 
annuel de la Commission de I'energie de 
I'Ontario decrivant les diverses activites de 
I'exercice 1987-1988. 

Veuillez agreer, votre honneur, I'assurance 
de ma tres haute consideration. 






Ministry 

of 

Energy 

Ministere 

de 

I'Energie 



Robert C. Wong 
Minister of Energy 



Le ministre de I'Energie, 
Robert C. Wong 



Introduction 

During the fiscal year April 1, 1987 to 
March 31, 1988, the Ontario Energy Board 
conducted a number of hearings and 
activities. Highlights of the year included: 

• hearings into the unbundling of service 
rates and contract carriage rates for Ontario's 
three major natural gas utilities: The 
Consumers' Gas Company Ltd., Union Gas 
Limited and ICG Utilities (Ontario) Ltd; 

• hearings into the gas pricing agreements 
the three utilities had renegotiated with 
TransCanada PipeLines' marketing arm, 
Western Gas Marketing Ltd.; 

• a review for the Minister of Energy of 
Ontario Hydro's bulk power rate proposal 
which specifically examined Hydro's 
methodology for determining net income; 

• a hearing into the role of brokers in 
Ontario; 

• the release of a report by the Municipal 
Franchise Agreement Committee, a committee 
of representatives from municipalities, the 
Board and industry whose goal was to 
develop a model Municipal Franchise 
Agreement; 

• the initiation of a review of rate making 
systems. The objective of this review was to 
examine new techniques of dispute resolution 
which would achieve the same goals as 
hearings, but which could reduce the time 
and costs associated with hearings; 

• a successful speakers series to which were 
invited people interested in regulatory matters 
and energy regulation; and 

• two successful conferences on electricity 
and natural gas conducted in association with 
University of Toronto's Institute for Policy 
Analysis. 



Introduction 

Au cours de I'exercice financier allant du 
l er avril 1987 au 31 mars 1988 la 
Commission de I'energie de I'Ontario a tenu 
des audiences et accompli nombre d'activites. 
Les faits saillants de I'exercice sont les 
suivants : 

• audiences sur la separation des tarifs de 
service et de transport imposes par les trois 
plus importantes compagnies ontariennes de 
services publics The Consumers' Gas 
Company Ltd., Union Gas Limited et ICG 
Utilities (Ontario) Ltd; 

• audiences sur les contrats fixant les prix du 
gaz renegocies par les trois compagnies avec 
Western Gas Marketing Ltd., I'entreprise de 
commercialisation de TransCanada Pipelines; ■ 

• a la demande du ministre de I'Energie de 
I'Ontario, I'etude de la proposition d'Ontario 
Hydro portant sur ses tarifs de vente 
d'electricite en gros et de la methode utilisee 
par Ontario Hydro pour etablir le revenu net; 

• une audience sur le role des courtiers en 
Ontario; 

• publication du rapport du comite charge 
des ententes de concessions municipales 
forme de representants des municipality, de 
la Commission et des industries et dont le but 
etait d'etablir un modele d'entente de 
concession municipale; 

• debut d'une revue des systemes de fixation 
des tarifs portant sur de nouveaux 
mecanismes de resolution des litiges et 
repondant aux memes objectifs que 
I'audience, mais plus rapidement et a 
moindre frais; 

• conferences fructueuses auxquelles ont 
participe les personnes interessees aux 
reglements regissant I'energie; et 

• deux conferences fructueuses sur 
I'electricite et le gaz naturel organisees en 
collaboration avec I'institut de I'analyse des 
politiques de I'universite de Toronto. 



The Ontario Energy Board: 
Scope of Operations 
Mandate 

The Ontario Energy Board was formed in 
1960 to provide an impartial formal 
mechanism for regulating specific aspects of 
Ontario's natural gas industry. In addition to 
its regulatory responsibilities, the Board, 
when requested in references from the 
Lieutenant Governor in Council or either of 
the Ministers of Energy and Natural 
Resources, will advise on matters relating to 
energy, such as changes made by Ontario 
Hydro to its bulk power rates. 

Most of the Board's responsibilities stem 
from legislation, as set out primarily in the 
Ontario Energy Board Act. In addition, five 
other statutes give jurisdiction to the Board: 

• the Municipal Franchises Act; 

• the Petroleum Resources Act; 

• the Public Utilities Act; 

• the Assessment Act; 

• the Toronto District Heating Corporation 
Act. 

Throughout its range of activities, the 
Ontario Energy Board operates with the 
primary objective of ensuring that the public 
interest is served and protected. 

Responsibilities 

Setting Rates for Natural Gas 

In Ontario, gas must be sold under a 
Board-approved rate Order. Gas distributors 
are required by law to submit rate proposals 
to the Board for review and approval. Rates 
are set for each utility following public 
hearings, which take place on a regular 
basis. 

Rates vary between classes of residential, 
commercial and industrial customers. In 
setting rates, the Board's objective is to reflect 
the costs imposed on the system by the 
varying demands of different classes of 
customers. For example, residential demand 
for natural gas as a heating fuel, changes 
according to the weather and the time of day. 
As a result, on a per unit basis it is more 
costly to provide service to residential users 
than to industrial customers, which use 
relatively large amounts of gas at a more 
consistent level. 

The Board aims at striking a balance 
between the prices to be paid by customers 



La Commission de l'Energie de l'Ontario : 

Apercu des Activites 

Mandat 

La Commission de I'energie de l'Ontario a 
ere creee en 1960 en tant que mecanisme 
officiel impartial charge de reglementer divers 
aspects de I'industrie ontarienne du gaz 
naturel. En plus de ses fonctions de 
reglementation, la Commission, a la 
demande du lieutenant-gouverneur en conseil 
ou des ministres de l'Energie et des Richesses 
naturelles, presente des recommandations sur 
les questions energetiques telles que les 
modifications apportees par Ontario Hydro a 
ses tarifs de vente en gros. 

Les responsabilites et pouvoirs de la 
Commission sont prescrits par la Loi sur la 
Commission de I'energie de l'Ontario et les 
lois suivantes : 

• Loi sur les concessions municipals; 

• Loi sur les richesses petrolieres; 

• Loi sur les services publics; 

• Loi sur revaluation fonciere; 

• Toronto District Heating Corporation Act. 
Toutes les activites de la Commission de 

I'energie de l'Ontario visent a servir le public 
et a proteger ses interets. 

Responsabilites 

Fixer les tarifs de gaz naturel 

En vertu de la loi ontarienne, le gaz doit 
etre vendu en vertu d'une ordonnance de la 
Commission. Les distributeurs de gaz doivent 
soumettre leurs propositions de tarifs a la 
Commission pour approbation. Les tarifs de 
tous les services publics sont fixes a la suite 
d'audiences publiques qui ont lieu 
periodiquement. 

Les tarifs exiges des categories de 
consommateurs residentiels, commerciaux et 
industriels ne sont pas informes. Lorsqu'elle 
fixe ces tarifs, la Commission tient compte des 
coOts associes a la variation de la demande 
des diverses categories de consommateurs. 
Ainsi, la demande residentielle de gaz 
naturel utilise pour le chauffage varie selon 
les conditions meteorologiques et la periode 
du jour. Par consequent, il coOte plus cher, 
par unite, de desservir les consommateurs 
residentiels que les industries qui utilisent de 
grandes quantites de gaz mais de facon plus 
uniforme. 




and the rate of return which shareholders of 
the utilities will earn on their investment. 

In fixing rates for the future, the Board 
considers past, present and projected 
expenses, together with current and forecast 
economic conditions and trends, and the 
earnings expectations of the utility operators. 

During rate hearings the Board also 
considers the quality of service provided to 
customers, including such matters as 
reliability, in order to ensure that service is 
commensurate with the rates charged. 

Granting Interim Rate Adjustments 

The Board may grant interim rate relief to 
either the company or the customers in cases 
where significant changes in a utility's costs 
or revenues have occurred, or will occur. This 
is usually done within the framework of a 
rates application and is subject to refund or 
other adjustment after the rates application 
has been completed. 

Reviewing Ontario Hydro Rates 

Ontario Hydro's bulk power rates are set 
by Hydro's own Board of Directors. However, 
when Hydro proposes to increase its rates, its 
rate proposal is referred to the Ontario 
Energy Board by the Minister of Energy, 
along with full technical information and 
financial data, and a public hearing is held. 
Following the hearing, the Board submits a 
report with recommendations to the Minister 
of Energy. These recommendations are not 
binding on Ontario Hydro or its Board of 
Directors, which has the responsibility for 
fixing final rates. 

Monitoring Utility Performance 

The Board receives information regularly 
from natural gas utilities regarding financial 
operations and performance. Where 
underearning or overearning occurs, the 
Energy Returns Officer and his staff may 
conduct a special investigation. The Board 
may, on its own motion, require a utility to 
appear before it to explain either excess 
earnings or underearnings. 



La Commission desire equilibrer les prix 
que doivent payer les consommateurs et le 
rendement des investissements effectues par 
les actionnaires des entreprises de services 
publics. 

Lorsqu'elle etablit les tarifs, la Commission 
tient compte des depenses anterieures, 
actuelles et futures, de meme que de la 
situation actuelle, des previsions, des courants 
economiques et des revenus anticipes par les 
exploitants de services publics. 

Lors des audiences publiques, la 
Commission considere egalement la qualite 
des services offerts aux consommateurs, la 
fiabilite afin que ces services soient 
proportionnes aux tarifs demandes. 

ACCORDER DES MESURES INTERIMAIRES DE 
REDRESSEMENT DES TARIFS 

La Commission peut accorder des mesures 
interimaires de redressement aux compagnies 
et aux consommateurs lorsque le cout des 
services publics ou les revenus generes par 
ces services subissent ou subiront des 
modifications importantes. Ces rajustements 
sont generalement effectues sur demande et 
sont sujets a une remise et a de nouvelles 
modifications une fois la demande terminee. 

REVOIR LES TARIFS D'OnTARIO HYDRO 

Les tarifs de vente en gros d'electricite 
d'Ontario Hydro sont etablis par le conseil 
d'administration de la societe. Lorsque 
Ontario Hydro desire augmenter ses tarifs, la 
proposition est presentee par le ministre de 
I'Energie a la Commission de Penergie de 
I'Ontario, accompagnee de toutes les 
donnees techniques et financieres, puis une 
audience publique a lieu. Suite a cette 
audience, la Commission presente son 
rapport et ses recommandations au ministre 
de I'Energie. Le conseil d'administration n'est 
pas tenu de se conformer a ces 
recommandations et il a le dernier mot quant 
aux tarifs. 

SURVEILLER LE RENDEMENT DES ENTREPRISES 
DE SERVICES PUBLICS 

Les compagnies de gaz naturel soumettent 
regulierement a la Commission des donnees 
sur leurs operations financieres et leur 
rendement. Lorsque les recettes sont 

insuffisantes ou trop elevees, le directeur des 
enquetes en matiere d'energie et son 



Reviewing Pipeline Construction 

A staff member of the OEB is appointed to 
serve as chairperson of the Ontario Pipeline 
Coordination Committee (OPCC), an 
interministerial committee concerned with the 
environmental and safety aspects of pipeline 
construction. 

Among the objectives of the OPCC are the 
avoidance of any long-term negative impact 
on the environment, and the minimizing of 
short-term impacts during construction. These 
objectives are achieved through the review of 
project proposals, including route or site 
alternatives, and resolution of issues before 
formal application for leave to construct has 
been filed with the Board. Since 1980 the 
OPCC has reviewed over 1500 kilometers of 
pipeline construction. 

The OPCC includes representatives from 
the Ministries of Agriculture and Food, 
Energy, Environment, Consumer and 
Commercial Relations, Natural Resources, 
Culture and Communications, Municipal 
Affairs and Transportation. Other regional 
agencies, with whom the natural gas utilities 
consult in the early stages of their planning, 
are also represented as required. 

Issuing Certificates of Public 
Convenience and Necessity 

These certificates grant permission for the 
construction of gas works and for the supply 
of gas to municipalities. 

Approving Franchise Agreements 

Each municipality must authorize through 
a by-law the supply of gas and the 
construction of distribution works in the 
municipality. Negotiations regarding terms 
and conditions are held between the utility 
and the municipality involved, and these 
franchise agreements must then be approved 
by the Board. 



personnel peuvent mener enquete. La 
Commission peut, de son propre chef, 
demander aux representants d'une entreprise 
de services publics de se presenter devant la 
Commission afin de discuter de I'exces ou du 
deficit des recettes. 

Etudier les repercussions associees a 
la construction de pipelines 

Un representant de la Commission preside 
le Comite ontarien de coordination des 
pipelines (COCP), un comite interministeriel 
etudiant la securite des pipelines et les 
repercussions environnementales resultant de 
leur construction. 

Le COCP veille entre autres a eviter toute 
repercussion environnementale negative a 
long terme et a minimiser les repercussions a 
court terme associees aux travaux de 
construction. Pour atteindre ces objectifs, le 
COCP revoit les projets proposes, etudie de 
nouvelles routes et de nouveaux 
emplacements possibles et resout les diverses 
questions soulevees avant que la demande 
d'autorisation de construire ne soit presentee 
a la Commission. Depuis 1980, le COCP a 
revu de nombreux projets portant sur la 
construction de plus de 1 500 kilometres de 
pipelines. 

Le COCP est forme de representants des 
ministeres de I'Agriculture et de 
I'Alimentation, de I'Energie, de 

I'Environnement, de la Consommation et du 
Commerce, des Richesses naturelles, de la 
Culture et des Communications, des Affaires 
municipales, et des Transports. Le comite 
comprend egalement, au besoin, des 
representants de divers organismes regionaux 
que consultent les compagnies de gaz naturel 
au debut du processus de planification. 

Emettre des certificats d'installations 
de services publics 

Ces certificats permettent la construction 
de reseaux de distribution de gaz et 
I'approvisionnement en gaz naturel des 
municipality. 

AUTORISER LES ENTENTES REGISSANT LES 
CONCESSIONS 

Chaque municipalite doit, par reglement, 
approuver la construction du reseau de 
distribution de gaz la desservant avant le 
debut des travaux. La municipalite et 




Approving Natural Gas Storage 
Areas 

Gas storage is a vital factor in Ontario's 
natural gas distribution system. The main 
storage sites used are depleted gas wells in 
southwestern Ontario. These storage areas 
are used by transmitters and distributors to 
meet fluctuating demand and to draw on in 
case of emergency. 

Gas may not be injected into any 
geological formation unless it is a designated 
gas storage area, described in Regulation 
700 under the Ontario Energy Board Act. 
The Ontario Energy Board recommends 
designation of gas storage areas to the 
Lieutenant Governor in Council. 

Gas is normally injected into storage 
during the summer months when demand is 
low, to be withdrawn in high consumption 
periods during the winter. This load 
balancing function makes it possible for the 
transmission system from Western Canada to 
operate in a highly efficient manner. 

Applications for drilling permits for wells 
within a designated gas storage area must 
be referred from the Minister of Natural 
Resources to the Board under the Ontario 
Energy Board Act. 

Applications to inject fluid and pressurize 
a geological formation require a permit from 
the Minister of Natural Resources. If the 
injection well is within 1 .6 kilometers of a 
designated gas storage area, the Minister is 
required to seek a report from the Board, 
pursuant to the Petroleum Resources Act. 

Unitizing Interests in Oil and Gas 
Pools 

The Board regulates the joining of the 
various interests within a spacing unit, field 
or pool for the purpose of drilling or 
operating gas or oil wells, the designation of 
management and the apportioning of the 
cost and benefits of such drilling or 
operation. 

Reviewing Changes in Ownership 

The leave of the Lieutenant Governor in 
Council is required when a utility wishes to 
sell its assets or amalgamate with another 
utility, and when any person wishes to 
acquire shares of a utility to the extent that 
more than 20 percent of any class of shares 



I'entreprise de services publics negocient les 
conditions et modalites de I'entente de 
concession qui doit etre soumise a la 
Commission pour approbation. 

Approuver le choix d'emplacements de 
stockage du gaz naturel 

Le stockage du gaz naturel est un element 
essentiel du reseau ontarien de distribution 
de gaz. La plupart des emplacements de 
stockage sont d'anciens puits de gaz situes 
dans le Sud-Ouest de la province, lis sont 
utilises par les distributeurs pour repondre 
aux variations de la demande et aux 
situations d'urgence. 

En vertu du reglement 700 pris en 
application de la Loi sur la Commission de 
I'energie de I'Ontario, il est interdit de 
stocker du gaz dans une formation 
geologique a moins qu'il ne s'agisse d'un 
emplacement designe. La Commission 
presente ses recommandations relatives aux 
emplacements de stockage au lieutenant- 
gouverneur en conseil. 

Le gaz est generalement stocke Pete car la 
demande est plus faible et utilise lors des 
periodes hivernales ou la demande est tres 
elevee. Grace a la repartition de la 
demande, le reseau de distribution de 
POuest canadien fonctionne de facon tres 
efficace. 

En vertu de la Loi sur la Commission de 
I'energie de I'Ontario, les demandes 
d'emission de permis de forage de puits 
dans une zone designee de stockage de gaz 
presentees au ministre des Richesses 
naturelles doivent etre remises a la 
Commission. 

Les compagnies qui desirent injecter des 
liquides dans une formation geologique et y 
exercer une pression doivent obtenir un 
permis aupres du ministre des Richesses 
naturelles. Si le puits d'injection est situe a 
moins de 1,6 kilometre d'une zone designee 
pour le stockage du gaz, le ministre doit 
demander a la Commission d'etudier la 
question et de presenter un rapport a ce 
sujet, conformement a la Loi sur les richesses 
petrolieres. 



changes ownership. The Board may 
recommend exemption from a hearing, or 
may hold a hearing and submit its report and 
recommendations to the Lieutenant Governor 
in Council. 

Reviewing Utility Accounting 
Procedures 

Natural gas utilities must conform to a 
uniform system of accounts as prescribed by 
the Board. No change in accounting methods 
may take place without the Board's approval. 
The Board is continuing its first significant 
review and upgrading of the regulation which 
prescribes the classification of accounting 
since it was made under the Ontario Energy 
Board Act in 1966. 

Reviewing Legislation 

The nature of public utilities changes in 
keeping with the changes in the economic and 
social environment in which they operate. 
Accordingly, it is appropriate for the Board to 
review legislation relating to public utilities, 
and, if necessary, to propose amendments. 

Conducting Generic Hearings and 
References 

A generic hearing may be held on the 
Board's own initiative, in response to an 
emerging trend in the industry, or to an area 
of growing interest or concern. Such hearings 
would deal with a subject in a broader 
context than issue-specific hearings. 

A reference on an energy-related matter 
may also be made to the Board by the 
Lieutenant Governor in Council, the Minister of 
Energy or the Minister of Natural Resources 
for review at a public hearing. 



Reunir les interets aux 
gisements de gaz et de petrole 

La Commission reglemente les divers 
interets au sein d'une surface unitaire, d'un 
champ ou d'un gisement qui s'unissent pour 
le forage et I'exploitation de puits de gaz et 
de petrole, la designation de la gestion et la 
repartition des couts et des avantages 
associes au forage et a I'exploitation. 

Revoir la vente et l' achat de 
proprietes 

Lorsqu'une entreprise de services publics 
desire vendre ses biens ou fusionner avec 
une autre entreprise de services publics et 
lorsqu'un particulier desire acheter pour plus 
de 20 pour 100 d'actions d'une meme 
categorie d'une entreprise de services 
publics, ces derniers doivent obtenir 
I'autorisation du lieutenant-gouverneur en 
conseil. La Commission peut recommander 
qu'une audience n'ait pas lieu ou peut tenir 
une audience et presenter son rapport et ses 
recommandations au lieutenant-gouverneur 
en Conseil. 

Revoir les methodes de comptabilite 
utilisees par les entreprises de services 

PUBLICS 

Les compagnies de gaz naturel doivent 
utiliser le systeme de comptabilite etablit par 
la Commission; ce systeme ne pouvant etre 
modifie sans I'autorisation prealable de la 
Commission. Celle-ci poursuit la mise a jour 
du reglement qui present la classification des 
methodes de comptabilite. II s'agit de la 
premiere refonte depuis I'adoption de la Loi 
sur la Commission de I'energie de I'Ontario 
en 1966. 

Revoir la legislation 

La nature des services publics offerts varie 
selon les changements que subissent 
I'environnement et le milieu social. Par 
consequent, la Commission doit revoir les lois 
qui touchent les services publics et, au besoin, 
proposer les amendements necessaires. 



Tenir des audiences generales et 
etudier des questions specifiques 

La Commission peut decider de tenir une 
audience generate en raison d'un courant 
precis au sein de I'industrie ou suite a une 
question d'importance croissante. Cette 
audience aborderait le sujet dans un contexte 
plus vaste que celui qui entoure les audiences 
portant sur une question precise. 

Le lieutenant-gouverneur en conseil, le 
ministre de I'Energie et le ministre des 
Richesses naturelles peuvent demander a la 
Commission d'etudier une question 
energetique specifique et de tenir une 
audience a ce sujet. 



Hoard members for the 
year April I. 1987 to March 
31, 1988 were, from left to 
right, DA Deem, C.A. Wolf, M. 
fackson, O.J. Cook, J. DeKourt, 
Chairman R.W Macanlay. 
\ Ice-chairman J. C. Butler 
C.l) Craddock, MA. Daub 
Missing wasM. Rounding, 

Les membres dti 
commission de I anil 1987 a 
3 1 mars 1988 etaient. gauch a 
droite, D.A. Dean, C.A. Wolf 
M.Jackson, O.J. Cook, J. 
DeKourt, President R.W. 
Macanlay. I 'ice-president J. C. 
Butler. C.U. Craddock. MA. 
Daub. 
Paspresente M Rounding. 




Organizational Structure 
As of March 31,1988 



Structure organisationnelle 
A la 31 mars, 1988 



R W Mocouloy Q C 



energy BERIBNS 

OFFICER/DIRECTOR Of 

FINANCE 

AGENIRENDEMENT 

ENERGETIQUE/OIRECTEUR 

DES FINANCES 

R Coppodoclo 



SECRETARY 10 THE 

CHAIRMAN 

SECRETAIRE DO 

PRESIDENT 



DEPUTY ENERGY RETURNS 

OFFICER/BOARD 

ACCOUNTANT 

AGENT ADJOINT- 

RENDEMENT 

ENERGETIQUE/COMPATABIE 

DELA COMMISSION 

A Meddowi-Toyloi 






DEPUTY ENERGY RETURNS 

OFFICERS 

AGENT|E|SADJOINT|E|S 

RENDEMENT 

ENERGETIOUE 

P Vlohui 
I Hoydin 
C Chopl.n 



EXECUTIVE ASSISTANT OT 

THE BOAKD 

ADJOINTE PRINCIPALE DE 

LA COMMISSION 



FINANCIAL 

ACCOUNTING 
ASSISTANT 
ADJOINTE 

COMPATABIJITE 
GENERALE 

S LJo 



BOARD SOLICITOR 
AVOCATE DE LA 
COMMISSION 



EXECUTIVE ASSISTANT TO 

THE CHAIRMAN 

ADJOINTE PRINCIPALE DU 

PRESIDENT 



BOARD SECRETARY 
SECRETAIRE DE LA 
COMMISSION 



K Chu 

E Pelef«(vTro|kov 

G Do..> 

W Woodal! 

A Purmetiui 



WORD PROCESSING 

OPERATOR 

OPERATES D'APPAREII 

DE TRAITEMENT DE 

TEXT! 



ASSISTANT 

BOARD 

SECRETARY 

SECRETAIRE 

ADJOINTE DE LA 

COMMISSION 

P O'Dell 



RECORDS CLERK 

PREPOSEE AUX 

DOSSIERS 



DIRECTOR TECHNICAL 
OPERATIONS 

DIRECTEUROPERATIONS 
TECHNIQUES 



BOARD MEMBERS 
MEMBRES DE LA 
COMMISSION 

DA Oeon 

OJ Cool 

CA WollJ. 

C U Croddod 



SENIOR PROJECT 

MANAGER 

CHEF PRINCIPAL D£ 

PROJETS 



BOARD MEMBERS 

IPART TIME] 
MEMBRES DE LA 
COMMISSION 

|A TEMPS PARTIELI 

MA Daub 
M Jotlion 

Votont 

Vocont 



SPECIAL PROJECTS 

OFFICER 

AGENT DES PROJETS 

SPECIAUX 



SENIOR PROJECT 

MANAGER 

CHEF PRINCIPAL DE 

PROJETS 

P CoroyannoLs 



PROJECT MANAGER 

FINANCIAL 

CHEF DE PROIETS 

FINANCES 

A Poreth 
B Conn 
H Gellet 



ADMINISTRATE 

CLERK 

COMMIS A 

I'ADMINISTRATION 



SENIOR PROJECT 

MANAGER 

CHEF PRINCIPAL DE 

PROJETS 



PROJECT MANAGER 

FINANCIAL 

CHEF DE PROIETS 

FINANCES 



SYSTEMS CO 

ORDINATOR 

COORDONNATRICE 

DES SYSTEMS 



PROJECT MANAGER 
ENGINEERING 
CHEF DE PROJETS 

GENIE 



PROJECT MANAGER 
ENVIRONMENT 
CHEF DE PROJETS 
ENVIRONNEMENT 



RESEARCH ANALYST 
ANALYSTS DE LA 

RECHERCHE 



The Board employed 4 1 full- 
time staff in fiscal 1987-88. 



An coins de Vexercice 
1987-1988, la Commission a 
employe 41 person lies a plein 
temps. 



Financial Structure 

The Ontario Energy Board Act authorizes 
the Board to recover its costs and to charge 
an appropriate portion of these costs to the 
utilities involved in Board hearings and 
related activities. 

Following a hearing, the Board issues a 
Cost Order to the utility involved. This 
represents payment towards meeting costs 
incurred by the Board and also, when 
ordered, towards meeting costs incurred by 
intervenors. The amount to be paid to the 
Board includes out-of-pocket and direct 
expenses attributable to a specific hearing, 
as well as a contribution towards the Board's 
fixed costs, including overhead and payroll 
costs. 

In fiscal 1987-88, the Board operated 
with an approved budget of $4.9 million. Of 
this amount, 65 percent, or $3.2 million, will 
be recovered by means of Cost Orders 
issued to utilities. 

The Public Hearing Process 

Public hearings provide an essential 
mechanism with which the Ontario Energy 
Board can carry out its mandate — to 
regulate natural gas companies, advise the 
government, and protect the public interest 
with regard to the pricing and distribution of 
natural gas and electricity. 

Public hearings also provide a forum for 
the participation of groups or individuals 
which may be affected by the Board's 
decisions. Public participation helps to 
ensure that the Board will render informed 
decisions which consider a wide variety of 
views and interests. 



Structure Financiere 

La Loi sur la Commission de I'energie de 
I'Ontario autorise la Commission a recouvrer 
ses frais et a imposer des redevances aux 
entreprises de services publics qui participent 
aux audiences de la Commission et aux 
autres activites connexes. 

Suite a I'audience, la Commission remet a 
I'entreprise de services publics une 
ordonnance de couts. II s'agit du paiement 
d'une partie des frais engages par la 
Commission et, si la Commission en decide 
ainsi, du paiement des frais engages par les 
intervenants. Le montant devant etre paye a 
la Commission comprend les depenses 
directes et les debours associes a une 
audience, de meme que le montant verse 
pour payer les coOts fixes etablis par la 
Commission, y compris les frais generaux et 
les salaires. 

Au cours de I'exercice 1987-1988, le 
budget d'exploitation de la Commission a ete 
de 4,9 millions de dollars. De ce montant, 
65 pour 100, soit 3,2 millions de dollars, 
seront recuperes par I'entremise des 
ordonnances de couts remises aux 
compagnies. 

Audiences publiques 

Les audiences publiques permettent a la 
Commission de I'energie de I'Ontario de 
mener a bien son mandat qui est de 
reglementer les compagnies de gaz naturel, 
de conseiller le gouvernement et de proteger 
les interets du public en ce qui a trait a la 
tarification et a la distribution du gaz naturel 
et de Pelectricite. 

Les audiences publiques favorisent 
egalement la participation de groupes et de 
particuliers qui peuvent etre affectes par les 
decisions de la Commission. La participation 
du public permet a la Commission de 
s'assurer que ses decisions sont justes et 
qu'elles tiennent compte des divers points de 
vue et interets. 



10 



The hearing process includes the following 
steps: 
/. Initiation 

The hearing process begins: 

• upon receipt of an application; or 

• upon receipt of a reference from the 
Lieutenant Governor in Council or from the 
Minister of Energy or the Minister of Natural 
Resources; or 

• upon notice from the Board that it will 
initiate proceedings to consider a matter 
under its jurisdiction. 

2. Notice of Application 

Applicants are required to serve notice of 
the application on all affected parties and 
interested public groups. If the Board itself has 
initiated a hearing, it too will serve notice. 

For a major rate case, a natural gas utility 
will publish announcements of its application 
in regional daily newspapers. It will also serve 
notice in person on municipal clerks in the 
utility's service area, and it may be required 
to notify others as directed by the Board. 

3. Interventions 

Interested groups or individuals wishing to 
participate in the hearing are referred to as 
'intervenors'. To ensure their eligibility to 
participate in the hearing, they must file a 
'notice of intervention', which explains their 
reasons for intervening. 

4. Notice of Hearing 

Once the Board has determined the scope 
and probable length of the hearing, it directs 
the applicant to serve notice of the time and 
place of the hearing on all parties who have 
intervened. 

5. Pre-Hearing Documentation 

To allow sufficient time for all parties to 
review information pertaining to the 
application, the applicant must file evidence in 
support of its application two to three months 
before the hearing commences. 

Board staff and intervening parties may 
also seek additional information by way of 
written interrogatories. These interrogatories 
must be answered by the utility before the 
hearing commences. 



Le processus d'audience se deroule 
comme suit : 
/. Debut 

Le processus debute : 

• des la reception d'une demande; ou 

• des la reception d'une demande 
presentee par le lieutenant-gouverneur en 
conseil, le ministre de I'Energie ou le ministre 
des Richesses naturelles; ou 

• des que la Commission decide qu'elle 
commencera a etudier une question de son 
ressort. 

2. Avis de presentation d'une demande 

Les requerants doivent aviser routes les 
parties concernees et tous les groupes publics 
interesses de la presentation de leur 
demande. Lorsque la Commission debute le 
processus d'audience, elle doit en aviser qui 
de droit. 

Lorsque I'audience porte sur une forte 
augmentation d'un tarif, la compagnie de 
gaz naturel doit faire publier une annonce 
dans les quotidiens de la region touchee 
annoncant qu'elle a presente une demande 
d'augmentation. Elle doit egalement aviser 
en personne les secretaires municipaux de la 
region qu'elle dessert et toute autre personne 
qui, selon la Commission, doit etre informee. 

3. Interventions 

Les groupes et les personnes qui desirent 
participer a une audience, ou "intervenants", 
doivent deposer un avis d' intervention 
decrivant les raisons pour lesquelles ils 
desirent etre presents. 

4. Avis d'audience 

Lorsque la Commission a determine la 
nature et la duree probable de I'audience, 
elle demande au requerant d'aviser toutes les 
parties concernees de I'heure a laquelle aura 
lieu I'audience et du lieu ou elle se 
deroulera. 

5. Documentation preparatoire 

Afin de permettre a toutes les parties 
d'etudier la documentation relative a la 
demande, le requerant doit remettre les 
documents a I'appui de sa demande de deux 
a trois mois avant le debut de I'audience. 

Le personnel de la Commission et les 
intervenants peuvent egalement obtenir des 



n 



In the case of applications for the 
construction of pipelines, which are reviewed 
by the Ontario Pipeline Coordination 
Committee, the normal requirements of pre- 
filed evidence would include route selection 
and environmental impact studies. 

6. Procedural Orders 

Depending on the case, the Board may 
issue Procedural Orders specific to the case. 
These may set the date for a hearing, for 
example, or contain deadline dates for 
completing certain procedural matters such as 
the filing of supporting evidence, 
interrogatories and answers thereto. 
Procedural Orders may also set forth a list of 
the issues to be dealt with at the hearing. 

7 . 'First Day' Proceedings 

Before the hearing of evidence 
commences, the Board panel may offer to 
review procedural matters, technical issues, 
and the general approach to the hearing. This 
gives everyone an opportunity to become 
familiar with the application and to identify 
all the issues they wish to address in the 
hearing. 

8. The Hearing 

The Board ensures that sufficient evidence 
is presented, tested and put on the record, so 
that an informed decision can be made. The 
applicant usually testifies first, through written 
evidence and witnesses. Intervenors and 
Counsel to Board staff will then question these 
witnesses, and may offer witnesses of their 
own. These witnesses may be cross-examined 
by the applicant or by the other intervenors. 

When all evidence has been given, each 
party has the opportunity to offer a 
summation in the form of written or oral 
argument, as directed by the Board. 

The pre-filed evidence, arguments and 
transcripts of the hearing are a matter of 
public record and are available at the Board 
office in Toronto. 

9. Board Decisions/Reports 

Depending on whether the hearing was a 
result of a reference, or either an application 
or a notice from the Board, the Board 
summarizes its deliberations in a document 
referred to as a 'Report', or a 'Decision with 
Reasons'. These documents discuss all the 



renseignements additionnels en demandant a 
I'entreprise de services publics de repondre a 
des questionnaires ecrits avant le debut de 
I'audience. 

Lorsque I'audience porte sur la construction 
de pipelines, qui est revue par le Comite 
ontarien de coordination des pipelines, les 
documents preparatoires doivent indiquer le 
trajet choisi et etre accompagnes des etudes des 
repercussions environnementales. 

6. Ordonnances de procedure 

La Commission peut emettre une ordonnance 
de procedure pour une affaire specifique. ^Par 
exemple, cette ordonnances peut determiner la 
date de I'audience ou prevoir la date limite 
avant laquelle certaines taches doivent etre 
effectuees telles que le depot de preuves 
justificatives, de questionnaires et les resultats 
de ces questionnaires. L'ordonnance de 
procedure peut egalement comprendre une liste 
de questions qui devront etre abordees lors de 
I'audience. 

7. Premieres deliberations 

Avant le debut de I'audience, les repre- 
sentants de la Commission peuvent suggerer de 
revoir les questions de procedure, les points 
techniques et I'approche qui sera utilisee pour 
I'audience. De cette facon, tous les participants 
peuvent prendre connaissance de la nature de 
I'audience et identifier les questions qu'ils 
desirent soulever. 

8. Audience 

La Commission s'assure que les preuves pre- 
sentees sonf suffisantes, qu'elles sont analysees 
et qu'elles sont consignees afin que la decision 
prise soit basee sur une bonne connaissance 
des faits. D'ordre general, le requerant te- 
moigne en premier par ecrit et en faisant appel 
a des temoins. Les intervenants et I'avocat de la 
Commission questionnent ensuite les temoins et 
peuvent eux aussi faire entendre des temoins. 
Ces derniers peuvent etre contre-interroges par 
le requerant et les autres intervenants. 

Lorsque toutes les preuves ont ete presentees, 
chaque partie peut recapituler les faits dans une 
plaidoirie ecrite ou verbale, selon les directives 
de la Commission. 

Le public peut prendre connaissance des 
documents preparatoires, des plaidoiries et des 
transcriptions de I'audience aux bureaux de la 
Commission, a Toronto. 



12 



issues and arguments raised in the hearing, 
and indicate the Board's recommendations or 
findings. 

In most cases referred to the Board by the 
Lieutenant Governor in Council, the Minister 
of Energy or the Minister of Natural 
Resources, the Board's recommendations are 
not binding. The appropriate Minister or the 
Lieutenant Governor in Council decides 
whether or not they should be implemented. 
However, in the case of references from the 
Minister of Natural Resources with respect to 
drilling permits, the recommendations are 
binding upon the Minister. 

Depending on the complexity of the case, 
the document will appear a few weeks or 
months after a hearing. Copies of the 
document are available from the Ontario 
Government Bookstore, 800 Bay Street, 
Toronto, upon payment of a modest 
prescribed fee. People involved in the hearing 
receive copies of the document from the 
Board. 
10. Board Order 

A Board Order is a legal, binding 
document which directs the implementation of 
a Board decision. 
/ / . Review and Appeal 

A Decision or Order of the Board may be 
appealed by: 

• applying to the Board requesting that it 
rescind or vary its Order; 

• petitioning the Lieutenant Governor in 
Council; 

• appealing an Order to the Divisional 
Court upon a question of law or jurisdiction; 

• applying to the Divisional Court for 
judicial review of a Board decision. 



9. Decisions et rapports de la Commission 

Selon que I'audience resulte d'un renvoi 
ou d'une demande ou d'un avis de la 
Commission, celle-ci doit presenter un resume 
de ses deliberations dans un "Rapport" ou 
dans un document intitule "Decisions et 
justifications". Ces documents portent sur 
toutes les questions soulevees lors de 
I'audience et comprennent les recomman- 
dations et les conclusions de la Commission. 

Dans la plupart des affaires prises en charge 
par la Commission a la demande du lieutenant- 
gouverneur en conseil, du ministre de I'Energie 
ou du ministre des Richesses naturelles, les 
parties concernees ne sont pas tenues de se 
conformer aux recommandations de la Commis- 
sion. Le ministre concerne ou le lieutenant- 
gouverneur en conseil decide s'il doit ou non 
donner suite a ces recommandations. Toutefois, 
lorsqu'il s'agit d'un renvoi de la part du ministre 
des Richesses naturelles au sujet d'un permis de 
forage, le ministre doit se conformer aux 
recommandations de la Commission. 

La publication du document peut necessiter 
quelques semaines ou quelques mois selon la 
complexity de I'affaire. Le document est mis en 
vente a la librairie du gouvernement de 
I'Ontario, 800, rue Bay, Toronto. La Commis- 
sion remet aux personnes ayant participe a 
I'audience un exemplaire de ce document. 

10. Ordonnance de la Commission 

Une ordonnance de la Commission est un 
document juridique auquel les parties concer- 
nees doivent se conformer et qui porte sur la 
mise a execution de la decision de la 
Commission. 
/ / . Revue et appel 

On peut interjeter appel d'une decision ou 
d'une ordonnance de la Commission de la 
facon suivante : 

• en presentant une demande a la 
Commission lui demandant d'annuler ou de 
modifier I'ordonnance; 

• en adressant une petition au lieutenant- 
gouverneur en conseil; 

• en interjetant appel de I'ordonnance de 
la Commission devant la Cour divisionnaire 
au sujet d'une question de droit ou de 
competence legale; 

• en demandant a la Cour divisionnaire 
de proceder a une revision judiciaire de la 
decision de la Commission. 



13 



List of Activities 

The following pages contain a list of the 
activities carried out by the Board between 
April 1 , 1 987 and March 31,1 988, as well 
as reviews of selected cases. 

Cases may have three stages: Hearing, 
Report or Decision with Reasons, and, where 
appropriate, Board Orders. 

Cases included in the following list may 
have only proceeded through one stage of 
the hearing process; some cases bridge from 
one fiscal year to the next before a Decision 
or Report is issued, depending on the timing 
of hearings. 



LlSTE DES ACTIVITES 

On trouvera dans les pages qui suivent 
une liste des activites effectuees par la 
Commission du l er avril 1987 au 31 mars 
1988 de meme qu'un resume de quelques- 
unes des causes traitees. 

Les causes comportent generalement trois 
etapes : I'audience, le rapport ou la 
decision de la Commission accompagnee 
d'une justification et, selon le cas, les 
ordonnances de la Commission. 

Certaines causes decrites dans le present 
rapport peuvent n'avoir atteint que la 
premiere etape du processus d'audience; 
d'autres peuvent s'echelonner sur deux 
exercices avant que la Commission ne rende 
sa decision ou ne presente son rapport selon 
I'epoque a laquelle a eu lieu I'audience. 



File Number 


Applicant/Originator 


Matter 


N° DE DOSSIER 


Requerant/Auteur de la demande 


Objet 


Natural Gas Rate Reviews and Interim Rate Reviews / Revue des tarifs de gaz naturel et des tarifs provisoires 


EBR0 397-B(*416) 


Natural Resource 


Vary Order 397-A / Ordonnance de modification 397-A 


EBRO 404-4 


ICG 


Interim Rates Vary Order / Ordonnance de modification des tarifs provisoires 


EBRO 410-11 (Ml 2 III) 


Consumers 


Gas Costs/Rate Design / Determination des couts/des tarifs de gaz 


-EBRO 410-111 


Consumers 


Gas Costs/Rate Design / Determination des couts/des tarifs de gaz 


EBRO 4 1 0-IIIA/4 1 4-1IA 


Consumers 


Rates Review Application by PPG Canada 

Tarifs - Demande d'examen presentee par PPG Canada 


EBRO 410/41 1/412 


Consumers/ICG/Union • 


T-rates (Also By-pass & Phase II) / Tarifs de transport Evitement et phase II) 


EBRO 410/411/412-1 


Consumers/ICG/Union 


T-rates By-pass (Also Phase 1 & II) / Evitement des tarifs de transport (Phases 1 et II) 


EBRO 410/41 1/412-11 


Consumers/ICG/Union 


T-rates Phase II (Also Phase 1 & By-pass) 

Tarifs de transport - Phase II (Phase 1 et evitement) 


EBRO 41 1-1 (Mil-Ill) 


ICG 


Phase II & T-rates, Nitrochem T-rate 

Phase II et tarifs de transport, tarif de transport - Nitrochem 


EBRO 411-11 (M12-III) 


Union 


Gas Costs/Rate Design / Determination des coOts/des tarifs de gaz 


EBRO 41 Mil 


ICG 


Gas Costs/Rate Design & Nitrochem 

Determination des couts/des tarifs de gaz et Nitrochem 


EBRO 41 1-III-A/430II-A 


Falconbridge 


Clarification, Rehearing or Review 41 l-lll 
Clarification, nouvelle audience ou revue 41 l-lll 


EBRO 412-11 (M12-III) 


Union 


Gas Costs/Rate Design / Determination des couts/des tarifs de gaz 


EBRO 412-111 


Union 


Gas Costs/Rate Design/Determination des couts/des tarifs de gaz 


EBR0 413-61-1-A 


Court Galvanizing 


Termination of CMP Discount - Union Gas/Expiration de la remise prevue par le 
programme de commercialisation competitive - Union Gas 


EBRO 4 14-11 (*4 10-11) 


Consumers 


Gas Rates/Rate Design/Determination des couts/des tarifs de gaz 


EBRO 416 (*397-B) 


Natural Resource Gas 


Rates / Tarifs 


EBRO 416-1 (*416) 


Natural Resource Gas 


Rates / Tarifs 


EBRO 416-1 A 


Natural Resource Gas 


Vary Order - Rates / Ordonnance de modification - Tarifs 


EBRO 430 


ICG 


Rates / Tarifs 


EBRO 430-2 


ICG 


Interim Rates / Tarifs provisoires 


EBRO 430-2A 


IGUA 


Application to Reopen Hearing / Demande de reouverture de I'audience 


EBRO 430-2B (Mil -III) 


ICG 


Phase 11 & T-rates Nitrochem T-rate 

Phase II et tarifs de transport, tarif de transport - Nitrochem 


EBRO 430-11 (Mil-Ill) 


ICG 


Phase II & T-rates Nitrochem T-rate 

Phase II et tarifs de transport, tarif de transport - Nitrochem 


EBRO 434 


Tecumseh 


Rates / Tarifs 


EBRO 435 


Cyanamid Canada 


Special Rate / Tarif special 


EBRO 437 


CIL 


Transportation and Storage of Gas / Transport et stockage du gaz 


EBRO 438 (M12-III) 


Union 


Storage Rate - Consumers/Tarif de stockage - Consumers 


EBRO 438-1 


Union 


Interim Storage Rate - Consumers/Tarif provisoire de stockage - Consumers 


EBR0 439(M12-III) 


Union 


Storage Rate - ICG/Tarif de stockage - ICG 



14 



EBR0 438 (M12-III) 


Union 


Storage Rate - Consumers / Tarif de stockage - Consumers 


EBRO 438-1 


Union 


Interim Storage Rate - Consumers / Tarif provisoire de stockage - Consumers 


EBRO 439 (*41 2-111) 


Union 


Storage Rate - ICG / Tarif de stockage - ICG 


EBRO 439-1 


Union 


Interim Storage Rate - ICG / Tarif provisoire de stockage - ICG 


EBRO 440 


ICG 


Rates / Tarifs 


EBRO 441 


Union 


Storage Rates - Sulpetro / Tarifs de stockage - Sulpetro 


EBRO 445 


Union 


Storage Rates - Kingston PUC 

Tarifs de stockage - Commission des services publics de Kingston 


EBRO 446 (M12-III) 


Union 


1 988 Storage Rates - Gaz Metropolitain/Tarifs de stockage de 1 988 


EBRO 446-1 


Union 


Interim Storage & Transportation Rates - Gaz Metropolitain 
Tarifs provisoires de stockage et de transport - Gaz Metropolitain 


Reference from the Minister of 


Energy Regarding Ontario Hydro / Renvoi de la part du ministre de l'Energie au sujet d'Ontario Hydro 


HR 16 


Minister of Energy 


Ontario Hydro Bulk Power Rates 1988 

Tarifs de vente en gros pour 1 988 fixes par Ontario Hydro 


Pipeline Construction and Expropriation / Construction 


DE PIPELINES ET EXPROPRIATIONS 


EBL0 218/219 


Union 


Kirkwall Line / Ligne Kirkwall 


EBLO 218/219 (1-33) 


Union 


Expropriations / Expropriations 


EBLO 222 


Union 


Toyota Transmission Line / Ligne de transmission Toyota 


EBLO 223 


Consumers 


Georgian Bay System Reinforcement 
Renforcement du reseau de la baie Georgienne 


EBLO 224 (also EBO 147) 


Tecumseh 


Dow-Moore Line / Ligne Dow-Moore 


EBLO 224(1) 


Tecumseh 


Expropriations - Dow-Moore / Expropriations - Dow Moore 


EBLO 225 (PL 62) 


Consumers 


Leave to Construct Peterborough/Lindsay 
Autorisation de construction - Peterborough/Lindsay 


Pipeline Exemptions / Dispenses 


RELATIVES AUX PIPELINES 




PL 54 


Union 


Dawn 167 Storage Pipeline / Pipeline de stockage Dawn 167 


PL 55 


Union 


Dominion Line Relocation White Oak Sideroad 

Deplacement de la ligne Dominion - Route Iransversale White Oak 


PL 56 


Union 


Dominion Line Relocation Concession II Road 
Deplacement de la ligne Dominion - Chemin Concession II 


PL 57 


Union 


East Owen Sound Relocation / Demenagement - Est d'Owen Sound 


PL 58 


Consumers 


Reinforcement Pipeline Fallowfield Road 
Renforcement de pipeline - Chemin Fallowfield 


PL 59 


ICG 


Onion Lake Proposed Looping - Thunder Bay 

Projet de voie d'evitement Onion Lake - Thunder Bay 


PL 60 


Union 


Owen Sound Line Relocation / Deplacement de ligne Owen Sound 


PL 61 


Consumers 


Orleans Reinforcement Project/Projet de renforcement Orleans 


PL 62 (*EBL0 225) 


Consumers 


Reinforcement System / Reseau de renforcement 


Other Energy Board Orders / Autres ordonnances de la 


Commission de l'energie 


EBO 134 


OEB 


Natural Gas System Expansion / Expansion du reseau de gaz naturel 


EBO 135 


Consumers 


Hillman Pool Unitization 

Exploitation concertee du gisement Hillman 


EBO 1 36 


Union 


Amended Contract Storage Transportation Kingston PUC 
Modification du contrat de stockage et de transport - 
Commission des services publics de Kingston 


EBO 1 37 


Union 


Gas Storage Contract for Consumers 
Contrat de stockage de gaz - Consumers 


EBO 138 


Union 


Gas Storage Contract for Gaz Metropolitain 
Contrat de stockage de gaz - Gaz Metropolitain 


EBO 139(*437) 


CIL 


Approval of Storage - Union / Approbation du stockage - Union 


EBO 140 


Union 


Gas Storage Contract with ICG / Contrat de stockage de gaz - ICG 


EBO 141 


Union 


Storage Agreement / Entente de stockage 


EBO 142 


Union 


Short-term Storage & Transportation - Kingston PUC 

Stockage et transport a court terme - Commission des services de Kingston 


EBO 143 


Union 


Approval of '88 Storage Contract - Gaz Metropolitain 
Approbation du contrat de stockage 1 988 - Gaz Metropolitain 


EBO 144 


Union 


Approval of '89 Storage Contract - Gaz Metropolitain 
Approbation du contrat de stockage 1 989 - Gaz Metropolitain 


EBO 145 Withdrawn 


Alessandro Randi 


Determination of Compensation - Union/Terminus Pool 
Determination de I'indemnisation - Gisement Union/Terminus 


EBO 146 


OEB 


Board Review of Jurisdiction for Gathering Lines 

Etude de la competence legislative ayant trait aux lignes de collecte effectuee 

par la Commission 


EBO 147(*EBL0 224) 


Tecumseh 


Dow-Moore Designation and Leave to Inject 
Designation et autorisation d'injecter - Dow-Moore 


Reports to the Minister / Rapports presente au ministre 




EBRM 86 


Bryant Energy 


Permit to Drill - Bryant/Union Moore Pools 
Permis de forage - Gisement Bryant/Union Moore 


EBRM 87 


Bryant Energy 


Permit to Drill Zone Gas Pool / Permis de forage dans la zone de gisement de gaz 


EBRM 88 


Union 


Permits to Drill - Dawn 1 67 Pool / Permis de forage - Gisement Dawn 1 67 



IS 



EBA447(*EBC 151) 


ICG 


EBA 488A 


Consumers 


EBA 489-A 


Consumers 


EBA 490-A 


ICG 


EBA 491 -A 


ICG 


EBA 492 (*EBLO 223) 


Consumers 


EBA 493 (*EBLO 223) 


Consumers 


EBA 494 


Consumers 


EBA 495 (*494) 


Consumers 


EBA 496 (*494) 


Consumers 


EBA 497-A 


ICG 


EBA 498-A 


ICG 


EBA 499-A 


ICG 


EBA 500-A 


ICG 


Certificates of Public Convenience 


and Necessity / Certificai 


EBC 151 (*EBA447) 


ICG 


EBC 177 


Northridge Petroleum 


EBC 178 


Atcor 


EBC 179 


Brenda Marketing 


EBC 180 


Consoligas Management 


EBC 181 


ICG 


EBC 182 (*EBL0 223) 


Consumers 


EBC 183 (*EBL0 223) 


Consumers 


EBC 184 


Consumers 


EBC 185 (*184) 


Consumers 


EBC 186 (* 184) 


Consumers 



Franchise Approvals / Autorisations relatives aux concessions 

Township of Alberton / Canton d'Alberton 

Township of Melancthon - Extension / Canton de Melancthon - Prolongement 

Township of Cavan - Extension / Canton de Cavan - Prolongement 

City of Sault Ste. Marie - Extension / Ville de Sault Ste. Marie - Prolongement 

Township of Augusta - Extension / Canton d'Augusta - Prolongement 

Township of Medonte / Canton de Medonte 

Village of Cold water / Canton de Coldwater 

Township of Hope / Canton de Hope 

Township of Hamilton / Canton de Hamilton 

Township of South Monaghan / Canton de South Monaghan 

Township of Cramahe - Extension / Canton de Cramahe - Prolongement 

Township of Hamilton - Extension / Canton d'Hamilton - Prolongement 

Township of Osnabruck - Extension / Canton d'Osnabruck - Prolongement 

Township of North Fredericksburgh - Extension 

Canton de North Fredericksburgh - Prolongement 

4STALLATIONS DE SERVICES PUBLICS 

Township of Alberton / Canton d'Alberton 

All Ontario Municipalities / Toutes les municipalities de I'Ontario 

All Ontario Municipalities / Toutes les municipalities de I'Ontario 

All Ontario Municipalities / Toutes les municipalities de I'Ontario 

All Ontario Municipalities / Toutes les municipalities de I'Ontario 

Village of Bath / Village de Bath 

Village of Coldwater / Village de Coldwater 

Township of Medonte / Canton de Medonte 

Township of Hope / Canton de Hope 

Township of Hamilton / Canton de Hamilton 

Township of South Monaghan / Canton de South Managhan 
References from the Lieutenant Governor in Council / Renvois de la part du lieutenant-gouverneur en conseil 
EBRLG 3 1 ICG Sale of Ft. Frances system to ICG / Vente de reseau Ft. Francers a ICG 

Uniform Accounting Orders / Ordonnances de comptabilite uniforms 
UA 067 Union Acquisition Spot Gas/Incurred UDC 

Achat de gaz sur le marche au cofmptant/Frais non absorbes engages lies a la demand 
UA 068 Union SNG Mitigation re: Petrosar/ Attenuation du gaz naturel sytnhetique 

UA 069 Union Price Reductions with TCPL / Reduction des prix avec TCPL 

UA 070 Consumers Income Tax Credits / Credits d'impot 

UA 071 Tecumseh Establishing Designated Deferred Accounts/Etablissement de comptes differes designes 

UA 072 ICG Variance Account Discretionary Gas Purchases & Sales 

Compte d'ecart - Ventes et achats discretionnaires de gaz 
UA 073 Consumers Compressor Fuel Cost Savings / Reduction des couts du carburant pour compresseurs 

UA 074 Union Change to Minimum Rule and Plant Units 

Adoption de la regie minimum et des unites manufacturieres 
Competitive Marketing Program (CMP) - Board Interim Orders (without a hearing) 
Programme de commerciausation competitive - Ordonnances provisoires de la Commission (sans audience) 
EBR0 413 Union 93 Applications Including Extensions and Vary Orders 

93 demandes, y compris les demandes de prolongement et les ordonnances de modification 
EBRO 450 Union 16 Applications / 16 demandes 

EBRO 4 1 5 Northern & Central/ICG 1 1 Applications Including Vary Orders 

1 10 demandes, y compris les ordonnances de modification 
EBRO 449 Northern & Central/ICG 1 Application / 1 demande 

EBRO 417 Consumers 200 Applications Including Extensions and Vary Orders 

200 demandes, y compris les demandes de prolongement et les ordonnances de modification 
EBRO 448 Consumers 10 Applications / 10 demandes 

EBRO 426 Inter-City Gas 2 (1 Application and 1 Vary Order) 2 (1 demande et 1 ordonnance de modification) 

Contract Carriage Arrangements (T-Rate) Board Interim Orders (without a hearing) 
contrats de transport (tarif de transport) - ordonnances provisoires de la commission (sans audience) 
EBRO 410 Consumers 68 Applications Including Extensions and Vary Orders 

68 demandes, y compris les demandes de prolongement et les ordonnances de modification 
EBRO 411 Northern & Central/ICG 6 Applications Including Vary Orders 

6 demandes, y compris les ordonnances de modification 
EBRO 41 2 Union 19 Applications Including Extensions and Vary Orders 

19 demandes, y compris les demandes de prolongement et les ordonnances de modifications 
Buy/Sell Arrangement - Board Interim Orders (without a hearing) / Entente de vente/d' achat - Ordonnances provisoires de la Commission (sans audience) 
EBRO 424 Union 88 Applications Including Extensions and Vary Orders 

88 demandes, y compris les demandes de prolongement et les ordonnances de modification 
EBRO 432 Consumers 8 Applications / 8 demandes 



16 



Review of Selected Activities 

During the fiscal year 1987-88, the 
Board's activities included a review of 
Ontario Hydro's bulk power rate proposal; 
the issuance of a model franchise agreement; 
an examination of the role of brokers in 
Ontario; hearings into expanding the natural 
gas system in Ontario, contract carriage 
rates, and the progress made by Ontario's 
three major gas utilities on the renegotiation 
of gas costs agreements with Western Gas 
Marketing (WGML) Ltd.; and an examination 
of the transfer of assets from Inter-City Gas 
Corporation to ICG Utilities (Ontario) Ltd. 



Natural Gas Distribution in Ontario 



Resume des activites 

Les activites de la Commission au cours de 
I'exercice 1987-1988 ont ete les suivantes : 
revue de la proposition presentee par Ontario 
Hydro sur les tarifs de vente d'electricite en 
gros; elaboration d'un modele d'entente de 
concessions; etude du role des courtiers en 
Ontario; audiences sur le prolongement du 
reseau de distribution de gaz en Ontario, les 
tarifs de transport et les progres accomplis 
par les trois plus importantes compagnies 
ontariennes de services publics dans le cadre 
des nouvelles negociations entreprises avec 
Western Gas Marketing (WGML) Ltd. sur les 
contrats fixant les prix du gaz; et etude du 
transfert de I'actif d'lnter-City Gas 
Corporation a ICG Utilities (Ontario) Ltd. 

La distribution du gaz naturel a 
l'Ontario 




Trans Canada Pipeline 
ICG Utilities 
Union Gas Limited 

Consumers Gas Company 

Limited 



17 




Energy Costs and Rates 
Gas Costs 

In the fall of 1986, the Board accepted 
for a one-year period the gas costs flowing 
from Memoranda of Agreement between 
WGML and each of Ontario's three major 
gas utilities: ICG, Union Gas and 

Consumers Gas. 

The Board indicated it would hold 
hearings before the end of October, 1 987 to 
review the progress in renegotiating those 
Memoranda. 

The Board heard the utilities' evidence on 
the renegotiations in the fall of 1987 and 
issued three Decisions simultaneously on 
January 22, 1988. The Board recognized 
that the prices resulting from the 1987 
agreements were discriminatory, but not 
unduly so. However, the Board reluctantly 
accepted the renegotiated agreements for a 
period of one more year, through to the 
expiry of the terms of the Memoranda of 
Agreement on October 31, 1988, to allow 
more time for the development of a more 
competitive market. 

In accepting the agreements, the Board 
also recognized the renegotiations were 
constrained by a number of factors. It 
commented on the competitive market and 
impediments to its achievement relating to 
the future of a deregulated natural gas 
market. Issues raised by the Board included 
the conversion of CMPs to direct sales; the 
need for pricing information; decontracting; 
self-displacement; TOPGAS matters; and 
security of supply. 

Unbundled Rates 

In its generic Contract Carriage Rate 
Decision of March 23, 1987, the Board 
established the principles to be used by 
Ontario's natural gas utilities in unbundling 
rates and designing new permanent contract 
carriage rates. 

In the fall of 1987, the Board conducted 
public hearings that dealt with the issues of 
customer classification, cost allocation and 
unbundled rate design for Consumers, Union 
and ICG. In May 1988, the Board issued its 
Decisions approving the utilities' unbundled 
transportation and other rates. Before these 
Decisions were issued, transportation rates 
had only been available in a bundled, all- 
inclusive form. 



COUTS ET TARIFS DE L'ENERGIE 
COUT DU GAZ 

A I'automne 1986, la Commission a 
approuve, pour une periode d'un an, les 
couts du gaz prevus par les protocoles 
d'entente conclus par WGML et chacune des 
trois plus importantes compagnies 
ontariennes de services publics : ICG, Union 
Gas et Consumers Gas. 

La Commission a fait savoir qu'elle 
tiendrait des audiences avant la fin d'octobre 
1987 afin de revoir les progres accomplis en 
vue de la renegociation de ces protocoles. 

A I'automne 1987, la Commission a 
entendu les preuves presentees par les 
compagnies sur les negociations et a 
simultanement rendu public trois decisions a 
ce sujet le 22 Janvier 1988. La Commission 
a reconnu que les prix prevus par les 
protocoles de 1987 etaient discriminatoires 
mais raisonnables. Toutefois, la Commission 
a accepte, avec quelque reticence, les 
protocoles d'ententes renegocies pour une 
autre annee et qui prendront fin le 31 
octobre 1988, pour favoriser le 
developpement d'un marche plus competitif. 

En acceptant les protocoles, la 
Commission a reconnu egalement que les 
negociations ont ete influencees par plusieurs 
facteurs. Elle a souligne la competitivite du 
marche et les obstacles a I'avenir d'un 
marche du gaz dereglemente. Parmi les 
questions soulevees par la Commission, on 
note I'incidence des programmes de 
commercialisation sur les ventes; la necessite 
de diffuser les renseignements sur les prix; 
I'annulation des contrats; la substitution 
individuelle; les questions relatives a TOPGAS 
et la securite de I'approvisionnement. 

Separation des tarifs 

Dans le cadre de la decision relative au 
tarif prevu par les contrats de transport 
rendue le 23 mars 1987, la Commission a 
etabli les principes qui seront utilises par les 
compagnies ontariennes de services publics 
pour separer les tarifs et fixer les tarifs prevus 
par les contrats de transport. 

A I'automne 1987, la Commission a tenu 
des audiences publiques sur la classification 
des consommateurs, la ventilation des couts et 
I'elaboration des tarifs de separation pour 



18 



The Consumers' Gas Company Ltd. 
(Consumers Gas) 
Gas Costs 

On August 31 and September 25, 1987, 
Consumers Gas signed agreements with 
WGML which, in conjunction with the 
disposition of certain deferred accounts, 
reduced its gas costs by approximately $40 
million over and above the discounts 
approved by the Board in 1986. Until its 
expiry date (October 31, 1988), the 
September agreement also extended special 
discounts for large volume customers. The 
hearing commenced on October 19, 1987, 
and was completed on November 12, 1987. 

In its Decision dated January 22, 1988, 
the Board accepted the agreements, subject 
to certain conditions. 

E.B.R.O. 410-lll/E.B.R.O. 414-ll/E.B.R.O. 417 

Unbundled Rate Design 

The Board's E.B.R.O. 410-11 Decision of 
March 23, 1987, established the principles 
to be used by Consumers Gas to design 
permanent contract carriage rates. The 
E.B.R.O. 410-111/414-11 hearing was 
convened on July 28, 1987, to examine 
Consumers' response to the Board's 
directions. The hearing adjourned on 
September 1 1, 1987. 

In its Decision dated May 18, 1988, the 
Board directed Consumers Gas to make 
revisions to its proposed cost allocation study 
and unbundled rate schedules. The company 
was directed to submit its revisions at the 
E.B.R.O. 452 proceedings (summer of 1988) 
for the consideration of the Board and 
interested parties. 

E.B.R.O. 410-111/414-11. 



Consumers, Union et ICG. Dans ses 
decisions de mai 1988, la Commission a 
approuve les tarifs de transport, de 
separation et autres proposes par les 
compagnies de services publics. Avant que 
ces decisions ne soient rendues, les tarifs de 
transport n'etaient disponibles que par 
regroupement. 

Consumers' Gas Company Ltd. 
(Consumers Gas) 
Couts DU GAZ 

Le 31 aout et le 25 septembre 1987, 
Consumers Gas a conclu une entente avec 
WGML et, au moyen de certains comptes 
differes, a reduit ses coOts de gaz de quelque 
40 millions de dollars en plus des rabais 
approuves par la Commission en 1986. 
L'entente conclue en septembre, qui prend fin 
le 31 octobre 1988, prevoit egalement le 
prolongement des rabais offerts aux gros 
consommateurs. L'audience a debute le 19 
octobre 1987 et a pris fin le 12 novembre 
1987. 

Dans sa decision du 22 Janvier 1988, la 
Commission a approuve cette entente, sous 
certaines conditions. 

E.B.R.O. 410-lll/E.B.R.O. 414-ll/E B R O 417 

Elaboration de la separation des tarifs 

La decision E.B.R.O. 410-11, rendue par la 
Commission le 23 mars 1987, a etabli les 
principes que devra utiliser Consumers Gas 
pour elaborer ses tarifs permanents de 
transport. L'audience E.B.R.O. 410-111/414-11 
a eu lieu le 28 juillet 1987 et a porte sur la 
reponse de Consumers Gas aux directives de 
la Commission. L'audience a ete ajournee le 
1 1 septembre 1 987. 

Dans sa decision du 18 mai 1988, la 
Commission a demande a Consumers Gas 
de revoir son etude du projet de ventilation 
des coOts et ses baremes de tarifs de 
separation. La Commission a egalement 
demande a la compagnie de soumettre les 
resultats de cette revision lors de l'audience 
E.B.R.O. 452 (ete 1988) pour que la 
Commission et les parties interessees puissent 
en prendre connaissance. 

E.B.R.O. 410-111/414-11 



Consumers Gas is Canada's 
largest natural gas distribution 
utility. Consumers serves 
approximately 926, 000 
residential, commercial and 
industrial customers in the 
south, central and eastern 
regions of Ontario and also 
supplies western Quebec and 
northern New York state. 
As of September 30, 1987, 
Consumers Gas rate base was 
SI. 36 billion . Gas sales 
totalling 8.539 billion cubic 
metres, and annual 
transportation sales of 0.600 
billion cubic metres generated 
$1,613 billion in revenue. 

La compagnie Consumers 
Gas est le plus important 
distributeur de gaz nature! au 
Canada. F.lle dessert quelque 
926 000 consommateurs 
residentiels, commerciaux et 
industrie/s dans les regions du 
Siul dn Centre et de I'Est de 
I'Ontario, de meme que dans 
I'ouest du Quebec et dans le 
nord de I'Etat de Neu • } brk. 
Au 30 septembre 1987, la 
base d'eraluation de Consumer 
Gas etait de 1.36 milliard de 
dollars. Les rentes de gaz ont 
atteint 8.539 milliards de 
metres cubes et le transport de 
0,6 milliard de metres cubes a 
genere des revenus de 1,613 
milliard de dollars. 



19 



/ nion is the second largest gas 
distributor in Ontario, It serves 
customers in southwestern 
( hitario, and also operates a 
network of pipeline, storage 
and compression facilities to 
provide service to customers 
(tnd other utilities in eastern 
Ontario and Quebec. 
As of March 31, 1988, I hion's 
rate base teas $939 million. 
I nion Gas served over 550,000 
residential, commercial and 
industrial customers. 
generating total throughput for 
fiscal 1988 ofl i. 2 billion 
cubic metres Total gas sales 
volumes moved for distribution 
customers, which includes both 
gas sales and transportation 
service, was 7.6 billion cubk 
metres, (ias transported to 
other than distribution 
customers was 6.6 billion cubic 
metres Total throughput 
revenue for I nion teas $1.24 
billion 

La compagnie I nion est le 
deuxieme plus important 
distributeur de gaz en Ontario 
Elle dessert le Sud-Ouest de 

/'Ontario et exploite egalement 
mi reseau de pipelines el 
direrses installations de 
Stockage el de compression 
desserraul les cousommateiirs 
el des compazines de sen ices 
publics dans I'Est de /'Ontario 
el an Quebec 
An >'/ mars 1988, la base 
d'evaluation de t nion etait de 
939 millions de dollars La 
compagnie dessert 550 0(H) 
consommateurs residentiels, 
commerciaux el industriels et 
sou debit a ele de 1-1.2 
milliards de metres cubes pour 
lexercice financier /9<S'<S' Les 
volumes totaux de gaz 



Union Gas Limited (Union) 
Gas Costs 

On September 28, 1987 Union filed its 
evidence with the Board for the hearing into 
its renegotiated gas pricing agreements with 
WGML. The hearing was reconvened on 
October 19, 1987, and adjourned on 
November 13, 1987. 

In its Decision dated January 22, 1988, 
the Board accepted the renegotiated 
agreements, subject to qualifications. The 
agreements were based on a one-year term 
ending October 31, 1988. 

E B.R.O. 412-111 

Unbundled Rate Design 

As noted in last year's annual report, the 
Board ordered the three major Ontario 
natural gas utilities to file new rate proposals 
during the summer of 1987 to implement 
contract carriage rates consistent with the 
principles established in the Board's Decision 
dated March 23, 1987. 

Union filed its new contract carriage rate 
proposals on June 8, 1987. First day 
proceedings were held on August 10, 1987, 
and the hearing reconvened one week later. 
The hearing was adjourned on September 
1 1, 1987, so that the Board could hear the 
evidence regarding gas costs based on 
renegotiated agreements with TCPL as 
ordered in an earlier Board decision. 

In its Decision with Reasons, dated May 
27, 1988, the Board approved in part 
Union's cost allocation and rate design 
application. The Board made findings on a 
list of over 40 issues and sub-issues, including 
deregulation in general, cost allocation, rate 
and toll schedule design, T-service and 
buy/sell contracts and storage. 

E.B.R.O. 412-111 etal 



Union Gas Limited (Union) 
Couts DU GAZ 

Le 28 septembre 1987, Union a depose 
ses preuves devant la Commission en vue de 
I'audience sur les nouvelles ententes relatives 
au prix du gaz negociees avec WGML. 
L'audience a ere reprise le 19 octobre 1987 
et ajournee le 13 novembre 1987. 

Dans sa decision du 22 Janvier 1988, la 
Commission a approuve les nouvelles 
ententes, sous certaines conditions. Elles 
couvrent une periode d'un an et prennent fin 
le 31 octobre 1988. 

E.B.R.O 412-111 

Elaboration de la separation des tarifs 

Tel qu'indique dans le rapport annuel de 
I'an dernier, la Commission a ordonne aux 
trois plus importantes compagnies de gaz 
naturel de presenter leurs nouvelles 
propositions de tarifs au cours de I'ete 1987 
afin que les tarifs de transport prevus par les 
contrats soient conformes aux principes 
enonces dans la decision de la Commission 
datee du 23 mars 1987. 

Union a depose ses propositions de tarifs 
de transport le 8 juin 1987. Les premieres 
deliberations ont eu lieu le 10 aoOt 1987 et 
l'audience a repris une semaine plus tard. 
Elle a ete ajournee le 11 septembre 1987 
pour permettre a la Commission d'entendre 
les preuves relatives aux couts du gaz bases 
sur les nouvelles ententes negociees avec 
TCPL, conformement a une decision 
precedente de la Commission. 

Dans sa decision, accompagnee de 
justifications, datee du 27 mai 1988, la 
Commission a approuve en partie la 
ventilation des coOts et la demande 
d'elaboration des tarifs presentees par Union. 
La Commission a presente ses observations 
sur plus de 40 questions et sous-questions, y 
compris la dereglementation en general, la 
ventilation des couts, I'elaboration des 
baremes de tarifs et de prix, le service T, les 
contrats de vente/d'achat et le stockage. 

E.B.R.O 412-111 etal 



20 



ICG Utilities (Ontario) Ltd (ICG) 
Gas Costs 

On October 19, 1987 ICG signed an 
agreement to amend its 1986 gas pricing 
agreement with WGML. The amending 
agreement applied to the period November 1 , 
1987, to October 31, 1988. ICG estimated 
that the new agreement, in conjunction with 
the disposition of certain deferral accounts, 
would reduce its gas costs by about $25 
million over and above the discounts 
approved by the Board in 1986. The Board 
heard evidence with respect to ICG's gas 
costs between November 24, 1987, and 
December 9, 1987. Its Decision with Reasons 
was issued on January 22, 1 988. 

The Board accepted the ICG agreement for 
a further one year period to allow for a further 
transition period toward the development of a 
fully competitive market. 

M.A.C. Daub, a Board Member, issued a 
dissent with respect to the further one year 
approval of the ICG agreement, expressing 
the view that the agreement contained 
discriminatory pricing not justifiable on the 
basis of cost. 

E.B.R.O. 41 1 -111/430-11/41 M/430-2B/415 

1987 Revenue Requirement - 
Phase I 

On October 6, 1986, ICG applied to the 
Board for an increase in its 1987 rates. ICG 
requested relief from a revenue deficiency of 
approximately $18,400,000; this amount 
was increased during the hearing to 
$19,473,500, and was based on a 14.75% 
return on equity and a 37.54% equity ratio. 

The hearing of evidence commenced on 
January 26, 1987, and was completed on 
February 20, 1987. The hearing was re- 
opened for two days on April 1, 1987. This 
was necessary because gas was flowing 
under transportation service agreements to 
certain of ICG's customers without the 
appropriate Board approvals in place. 



ICG Utilities (Ontario) Ltd (ICG) 
Couts DU GAZ 

Le 19 octobre 1987, ICG a signe une 
entente modifiant celle de 1986 regissant les 
prix du gaz conclue avec WGML. Cette 
nouvelle entente couvrait la periode du l er 
novembre 1987 au 31 octobre 1988. 
Selon ICG, la nouvelle entente permettrait a 
la compagnie, au moyen de certains comptes 
differes, de reduire ses coOts d'environ 25 
millions de dollars, en plus des rabais 
approuves par la Commission en 1986. Du 
24 novembre 1987 au 9 decembre 1987, 
la Commission a entendu les preuves d'ICG 
relatives aux couts du gaz et a rendu sa 
decision, accompagnee de justifications, le 
22 Janvier 1988. 

La Commission a approuve I'entente 
d'ICG pour une autre annee afin de 
prolonger la periode de transition en vue de 
faciliter le developpement de la libre 
concurrence. 

M.A.C. Daub, membre de la Commission, 
a fait valoir sa dissidence au sujet de 
I'approbation de I'entente pour une autre 
annee. II estime que les prix prevus par 
I'entente sont discriminatoires et ne sont pas 
justifies compte tenu des couts. 

E.B.RO. 41 1 -111/430-11/41 1-I/430-2B/4 15 

Recettes necessaires pour 1987 - 
Phase I 

Le 6 octobre 1 986, ICG a presente a la 
Commission une demande d'augmentation 
de ses tarifs pour 1987 afin de compenser 
une insuffisance de recettes d'environ 18 
400 000 $, chiffre qui a ete porte a 19 
473 500 $ lors de I'audience, compte tenu 
d'un rendement des capitaux propres de 
14,75 pour 100 et d'un ratio des actions 
ordinaires de 37,54 pour 100. 

L'audience a debute le 26 Janvier 1987 
et a pris fin le 20 fevrier 1987. L'audience 
a repris pour deux jours le l er avril 1987 
parce que ICG distribuait du gaz a certains 
consommateurs dans le cadre d'ententes de 
transport non approuvees par la 
Commission. 

Le 15 juillet 1987, la Commission a rendu 
publique sa decision accompagnee de 
justifications. Dans cette decision, elle a evalue 
I'insuffisance des recettes a 10 801 060 $, 



transposes el vendus aux 
compagnies de distribution ont 
etc de 7.6 milliards de metres 
cubes. Les volumes de gaz 
achemines aux 
consommateurs autres que les 
< ompagnies de distribution ont 
atteinl 6,6 milliards de metres 
i ubes. Les revenus generes par 
le debit total ont ete de I ,24 
milliard de dollar 



ICG (formerly Northern and 
Central das Corporation 
Limited) series approximately 
1 20 communities in 
northwestern, northern and 
eastern Ontario It operates a 
natural gas distribution system 
comprised of about 5. (>()() 
kilometres of pipeline 
originating at more than 80 
delivery points on the TCPL 
transmission system. The ICG 
system is a series of laterals off 
the TCPL pipeline as it crosses 
Ontario starting at Kenora and 
extending to the shore of Lake 
Ontario and the St. Laurence 
River. 

As of December 31, 1987, ICG's 
average rate base was $381.8 
million. Serving 159.000 
customers. ICG's gas sales 
totalled 2.9 billion cubic 
metres, and transportation 
stiles totalled 21 7 million cubic 
metres, generating revenue of 
about $425 million 



21 



in compagnie ICG 
(anciennement Northern and 
Central Gas Corporation 

Limited) (lessen quelque 12a 
collectivites dans le Nord- 
Quest, le Sard el VEst de 
I'Ontario. Elle exploite mi 
reseau de distribution degaz 
naturel forme d'environ 5 600 
km de pipelines relies a plus de 
SO points d'ecbange du reseau 
de collecte el de distribution de 
gaz de TCPL Le reseau d'ICG 
est forme d'une serie de 
branchements relies au 
pipeline de TCPL et trarersaut 
I'Ontario a partir de Kenora 
fusqu'aux tires du lac Ontario 
et du fleuee Saint-Laurent 
An 31 decembre 1987, la 
base moyenne devaluation 
d'ICG etait de 381,8 millions 
de dollars. Les i 'entes de gaz 
d'ICG a ses quelque 159 000 
consommateurs ont atteint 2,9 
milliards de metres cubes et les 
rentes de distribution 217 
millions de metres cubes, 
generant des rerenus d'environ 
425 millions de dollars. 



The Board issued its Reasons for Decision 
on July 15, 1987. It found a revenue 
deficiency of $10,801,060, based on a 
13.25% return on equity and a 37% 
common equity ratio. The Board ordered 
that the deficit be recovered on an 
annualized volumetric basis, effective 
February 20, 1987. These rates were 
interim pending completion of the Phase II 
proceedings. 

The Board took issue with ICG's internal 
controls and formal communication 
procedures, observing that its management 
had not been fully effective. The Board, 
however, recognized that a management 
audit had been initiated by the company and 
was underway. 

E.B.R.O. 430 

1 988 Revenue Requirement - 
Phase I 

ICG filed an application with the Board 
for increased rates on September 9, 1987. 
Relief from a revenue deficiency of 
$13,441,000 was requested. This amount 
was reduced to $9,407,250 during the 
hearing. 

The Board issued its Decision with 
Reasons on February 19, 1988, finding a 
revenue deficiency of $1,440,000. This 
deficiency was to be recorded in a deferral 
account, which was to be disposed of on the 
basis of the E.B.R.O. 430-11 Phase II 
Decision. The Board's Decision applied a 
hypothetical common equity ratio of 36%, as 
the Board felt that ICG's requested actual 
common equity ratio of 40.7% was 
excessive. 

At the time the Decision was released, the 
report of ICG's management auditors had 
not been released. Therefore, the Board 
established a deferral account to accrue 
costs which may arise as a result of ICG's 
implementation of the recommendations of 
this report. This account is to be dispensed 
with in a future hearing. 

E B.R.O. 440 



d'apres un rendement des capitaux propres 
de 13,25 pour 100 et un ratio des actions 
ordinaires de 37 pour 100. La Commission 
a ordonne que ce deficit soit recupere 
d'apres une base volumetrique annuelle a 
compter du 20 fevrier 1987. Ces tarifs 
etaient provisoires jusqu'a la fin des 
deliberations de la phase II. 

La Commission a souleve la question des 
controles internes et des methodes de 
communication au sein de ICG, 
s'interrogeant sur I'efficacite de la gestion. 
Toutefois, la Commission a reconnu que la 
compagnie avait amorce une verification de 
sa gestion. 

E.B.R.O. 430 

Recettes necessaires pour 1 988 - 
Phase I 

Le 9 septembre 1987, ICG a presente a 
la Commission une demande d'augmentation 
de ses tarifs afin de compenser une 
insuffisance des recettes de 1 3 441 000 $. 
Ce montant a ete reduit a 9 407 250 $ 
lors de I'audience. 

Le 19 fevrier 1988, la Commission a 
rendu publique sa decision accompagnee de 
justifications evaluant I'insuffisance des 
recettes a 1 440 000 $. Cette insuffisance 
devait etre portee a un compte differe devant 
etre cede conformement a la decision 
E.B.R.O. 430-11, phase II. La decision de la 
Commission tenait compte d'un ratio 
hypothetique des actions ordinaires de 36 
pour 1 00, le ratio de 40,7 pour lOOayant 
ete juge excessif par la Commission. 

Lorsque la decision a ete rendue publique, 
le rapport des verificateurs de la gestion de 
ICG n'avait pas ete publie. Par consequent, 
la Commission a etabli un compte differe afin 
d'inscrire les couts que pourrait entratner la 
mise en application des recommandations 
formulees dans ce rapport. Ce compte sera 
annule lors d'une audience future. 

E.B.R.O. 440 

Elaboration de la separation des tarifs 

Cette audience a porte essentiellement sur 
la phase II de la seperation des tarifs prevue 
par les contrats, la reclassification des 
consommateurs, la ventilation des couts et les 
questions relatives a I'elaboration des tarifs 
et aux autres frais proposes par ICG. 



22 



Unbundled Rate Design 

This hearing was held primarily to deal 
with Phase II unbundled contract carriage 
rates, customer reclassification, cost 
allocation and rate design matters relating to 
the rates and other charges proposed by 
ICG. Included in the hearing was an 
application by Nitrochem Inc. for a special 
rate status. Also included was an application 
by ICG for final approval of 'special rates' for 
each of Rio Algom, Denison Mines Ltd., 
Eldorado Resources Ltd., Domtar Inc., Algoma 
Steel Corporation Ltd. and Grant Waferboard 
Ltd. 

The hearing began on September 10, 
1987, and ended on February 1, 1988. 
Twenty-two hearing days were required to 
complete the Phase II proceedings. The 
Board made decisions in a number of areas, 
including customer reclassification, cost 
allocation, rate design, special rates, terms, 
and conditions of service. The Board issued 
its Decision on May 20, 1988. 

E.B.R.O. 41 1 -111/430-11/41 1-1/430-26/415/404 

Ontario Hydro 

Bulk Power Proposal 

On April 15, 1987, the Minister of Energy 
referred to the Board Ontario Hydro's 
proposal to increase its bulk power rates by 
an average 4.9% effective January 1, 1988. 
This proposal represented an increase in 
revenues of $420 million, of which $255 
million was to be recovered through the rate 
increase, allowing for net income of $413 
million. The hearing of evidence commenced 
on May 27, 1987, and was completed on 
July 15, 1987. 

Argument was completed on July 31, 
1987 and the Report issued to the Minister of 
Energy on September 15, 1987. In its review 
of the Operations, Maintenance and 
Administration budget, the Board gave 
special consideration to the cost-efficiency 
and effectiveness of activities of the 
production branch. Special consideration 
was also given to the appropriate 
methodology for determining net income. 



L'audience a egalement traite de la demande 
presentee par Nitrochem Inc. pour 
I'imposition de "tarifs speciaux". La 

Commission a egalement revu lors de 
l'audience la demande presentee par ICG 
pour I'imposition de tarifs speciaux a Rio 
Algom, Denison Mines Ltd., Eldorado 
Resources Ltd., Domtar Inc,. Algoma Steel 
Corporation Ltd. et Grant Waferboard Ltd. 

L'audience a debute le 10 septembre 
1987 et a pris fin le l er fevrier 1988. La 
phase II a necessite vingt-deux jours 
d'audience. La Commission a resolu 

plusieurs questions dont la reclassification des 
consommateurs, la ventilation des couts, 
I'elaboration des tarifs, les tarifs speciaux de 
meme que les modalites et conditions de 
service. La Commission a rendu sa decision 
le 20 mai 1988. 

E B R.O. 41 1 -111/430-11/41 M/430-2B/4 15/404 

Proposition d'Ontario Hydro pour la 
vente en gros d'electricite 

Le 15 avril 1987, le ministre de I'Energie 
a soumis a la Commission la proposition 
d'Ontario Hydro visant a augmenter ses tarifs 
de ventes en gros d'electricite de 4,9 pour 
100 a compter du l er Janvier 1988. Cette 
proposition representait une augmentation 
des revenus de 420 millions de dollars. De 
ce montant, 255 millions de dollars devaient 
etre recuperes par I'augmentation des tarifs, 
resultant en un revenu net de 41 3 millions de 
dollars. L'audience a debute le 27 mai 
1 987 et a pris fin le 1 5 juillet 1 987. 

La plaidoirie a pris fin le 31 juillet 1987 
et le rapport a ete remis au ministre de 
I'Energie le 15 septembre 1987. La 
Commission a revu le budget alloue aux 
operations, a I'entretien et a I'administration 
et a accorde une attention particuliere a la 
rentabilite et a I'efficacite des activites de 
production. On a egalement tenu compte de 
la methodologie utilisee pour determiner le 
revenu net. 

La Commission a recommande deux 
augmentations acceptables des tarifs, 
chacune s'appliquant a des circonstances 
differentes. Se basant sur la methodologie et 
les definitions utilisees par Ontario Hydro, la 
Commission a juge trop elevee 
I'augmentation de 4,9 pour 100 proposee 



Ontario Hydro is Ontario's 
largest Crown i orporation 
As of December 31, 1987, 
Ontario Hydro had assets of 
t \2,657 million Ontario 
Hydro direi tfy and indirectly 
•.erred more than ',. ,' / i,000 
customers, of which more 
than 85 percent are 
residential Revenue oj 
$5,280 million resulted from 
provim ial -.ales of 120,218 
Gwh and export sales of 
6,515 Gwh 



Ontario Hydro est la plus 
imporlanle societe de la 
Couronneen Ontario. An 31 
decembre 1987. son actifetait 
de 32 657 millions de dollars 
Ontario Hydro dessert, 
direetement et nidirectement. 
plus de 3 344 000 abonnes, 
dont 85 pour 100 sunt de type 
residen del Les rentes 
provinciates de 120 218 Gwh 
et Vexportation de 6 515 Gwh 
ontgenere des revenus de 5 
2SO millions de dollars 



23 




The Board recommended two acceptable 
rate increases, each appropriate under 
different circumstances. Using Hydro's own 
definitions and methodology, the Board found 
the 4.9% rate increase sought by Hydro to be 
high, and recommended an increase of 
1 .3%. If Hydro were to employ an approach 
to pricing which, in the Board's view, 
reflected market-based costs of capital, the 
rate increase should be 3.7%. 

Other major recommendations made by 
the Board were: 

• that Hydro not adopt rate policies which 
could be binding for the long term, such as 
the policy of no real rate increase for the 
1 980s; 

• that Hydro implement more conservation 
programs; 

• that Hydro's rural and direct sales class 
deficit scheme being ultra vires, be 
abandoned immediately; 

• that the Minister of Energy call a special 
hearing to examine the issues relating to 
parallel generation; 

• that the Province charge Hydro a debt 
guarantee fee; and 

• that external management consultants be 
retained by Hydro to review staff levels, and 
that the consultants consider in particular the 
role and organization of Hydro's forecasting 
function. 



par la societe et a recommande une 
augmentation de 1 ,3 pour 100. Si Ontario 
Hydro utilise une tarification qui, selon la 
Commission, reflete les couts des 
immobilisations bases sur le marche, 
I'augmentation des tarifs devrait etre alors de 
3,7 pour 100. 

Les principales recommandations de la 
Commission sont les suivantes : 

• Ontario Hydro ne devrait pas adopter 
une politique de tarification a long terme, 
comme par exemple une politique ne 
prevoyant aucune augmentation reelle dans 
les annees 1 980; 

• Ontario Hydro devrait mettre en 
application plus de programmes d'economie 
d'energie; 

• Ontario Hydro devrait abandonner 
immediatement sa politique de deficit entre 
les ventes rurales et les ventes directes car la 
societe excede ses pouvoirs; 

• le ministre de I'Energie devrait 
demander la tenue d'une audience speciale 
afin d'examiner les questions associees a la 
generation parallele; 

• le gouvernement provincial devrait 
demander a Ontario Hydro de lui payer un 
droit pour garantir sa dette; 

• Ontario Hydro devrait retenir les 
services d'experts-conseils charges d'etudier 
les besoins en personnel de meme que le role 
et I'organisation des previsions etablies par la 
societe. 



24 



Summary of Board Findings, H.R. 16 
1 988 Pro Forma Income Statement* 

($ million) 



Resume des conclusions de la Commission, 
H.R. 16 

Resultats pro forma 1988* 

(millions de dollars) 



Hydro's Original 
Forecast 

Prevision originale 
d'Ontario Hydro 



Hydro's Updated 
Forecast 

Nouvelle prevision 
d'Ontario Hydro 



OEB Recommendations 
Recommandations de la CEO 



Scenario 1 
Scenario 1 



Scenario 2 
Scenario 2 



Revenue 
Revenus 



Primary 
Primaires 
Secondary 
Secondares 



Total 



5,447 
125 



5,572 



5,447 
183 



5,630 



5,411 
203 



5,614 



5,287 
203 



5,490 



Expenses 




Charges 




OM&A 




0,E, A 


1,234 


Fuel 




Combustible 


1,101 


Depreciation 




Depreciation 


805 


Interest & Foreign Exchange 




Interets et change 


2,018 


Debt Guarantee 




Garantie de la dette 


— 



1,269 

1,167 

787 

1,951 



,234 

,146 

785 

,907 

27 



,234 
,146 
785 
,912 



Total 



5,158 



5,174 



5,099 



5,077 



Net Income 

Revenus nets 41 3 

Propsed Rate Increase 

Augmentation des tarifs proposee 4.9% 



456 



4.9% 



515 



3.7% 



413 



1 .3% 



'Columns may not add due to rounding. 

Scenario 1 : Includes a market-based concept of net income, 

and reflects a transition to a more appropriate pricing of Hydro's 

services requiring a rate increase of 3.7%. 

Scenario 2: Reflects Hydro's definitions and methodologies which, 

in the Board's opinion, foil to fully account for Hydro's cost of 

capital, a rate increase of 1 3% is required. 



*Le total des colonnes peut ne pas corresponds a la somme reelle, 

les donnees ayant ete arrondies 

Scenario 1 : Comprend un revenu net base sur le marche et reflete 

une transition permettant d'obtenir une meilleure tarification des 

services d'Ontario Hydro et necessitant une augmentation des tarifs 

de3,7 pour 100 

Scenario 2 ; Reflete les definitions et la methodologie utilisees par 

Ontario Hydro et qui, selon la Commission, n'expliquent pas 

enlierement les couts engages par la societe pour ses 

immobilisations; une augmentation des tarifs de 1 ,3 pour 1 00 etant 

necessaire. 



25 



Facilities 
Transmission/Distribution 

Union Gas Facilities Expansion on the 

Dawn/Trafalgar System 

On September 28, 1987, Union Gas 
applied to the Board for leave to construct its 
1988 Dawn/Trafalgar facilities expansion. 
Proposed were two large diameter pipelines. 

The first, the Brantford take-off to Kirkwall 
section, was a continuation of Union's 42 
inch (1,067 millimetre) looping program. The 
pipeline parallels Union's existing 34 inch 
(864 millimetre) and 26 inch (660 millimetre) 
pipelines in the Township of North Dunfries 
and the Town of Flamborough respectively. 
The new line is approximately 13.5 
kilometers long and runs through the African 
Lion Safari Park. Construction was scheduled 
to minimize disruption to the park. 

The second, the Kirkwall line, originates in 
the Town of Flamborough, continues south to 
the Town of Ancaster, and then runs east to 
the City of Hamilton. It is a 24 inch (610 
millimetre) pipeline which will directly connect 
Union's Dawn/Trafalgar system to its 
Hamilton market. 

The need for these facilities was based on 
the requirement for additional capacity to 
meet demand growth on the Dawn/Trafalgar 
system, to accommodate the needs of the 
developing industrial area in and around 
Nanticoke, and to provide enhanced security 
of supply for the City of Hamilton. 

E.B.L.O. 218/219, 

Union Gas Limited Toyota Pipeline 

Union filed an application dated February 
18, 1987, for leave to construct 8.1 
kilometers of a 10 inch (273 millimetre) 
pipeline to the proposed Toyota vehicle 
assembly plant in the City of Cambridge. The 
hearing was held in Toronto on April 15, 
1987, and an oral Decision was given on 
April 21, 1987. 

The Board was concerned that no gas 
sales contract had been signed between 
Union and the Toyota company, thereby 
increasing the risk of the project. The Board 
found that a contribution in aid of 
construction in the amount of $457,000 was 
necessary, and Union provided the Board 
with documentation showing that such a 



Installations 
Collecte/Distribution 

Agrandissement des installations de 

Union Gas sur le reseau Dawn/ 

Trafalgar 

Le 28 septembre 1987, Union Gas a 
demande a la Commission d'autoriser 
I'agrandissement des installations 

Dawn/Trafalgar. Les travaux proposes 
comprenaient la construction de deux gros 
pipelines. 

Le premier pipeline, le branchement lateral 
Brantford de la section Kirkwall, est la suite 
du programme de doublement de 42 pouces 
(1 067 millimetres). Le pipeline longe le 
pipeline de Union de 34 pouces (864 
millimetres) et celui de 26 pouces (660 
millimetres) situes respectivement dans le 
canton de North Dunfries et dans la ville de 
Flamborough. La nouvelle conduite mesure 
environ 13,5 kilometres et traverse le pare 
African Lion Safari. La construction devait 
tres peu perturber le pare. 

La conduite Kirkwall part de la ville de 
Flamborough, dessert la ville de Ancaster au 
sud puis Hamilton, a Test. II s'agit d'un 
pipeline de 24 pouces (610 millimetres) qui 
reliera le reseau Dawn/Trafalgar de Union au 
marche d'Hamilton. 

Ces installations sont necessaires pour 
accroTtre la capacite afin de repondre a la 
demande a laquelle fait face le reseau 
Dawn/Trafalgar. On doit egalement 

repondre aux besoins de la region industrielle 
de Nanticoke, en pleine croissance, et 
assurer I'approvisionnement de la ville de 
Hamilton. 

E.B.L.O. 218/219 

Pipeline Toyota de Union Gas Limited 

Le 18 fevrier 1987, Union a presente une 
demande d'autorisation pour la construction 
d'un pipeline de 10 pouces (273 
millimetres) long de 8,1 kilometres pour 
desservir I'usine automobile projetee par 
Toyota dans la ville de Cambridge. 
L'audience a eu lieu a Toronto le 15 avril 
1987 et une decision verbale a ete rendue le 
21 avril 1987. 

La Commission s'est dite inquiete du fait 
qu'aucun contrat de vente de gaz n'avait ete 
conclu entre la compagnie Toyota et Union, 
ce qui accroTt les risques du projet. La 



26 



contribution had been approved by the 
Government of Ontario. The application was 
granted subject to conditions of approval. 

E.B.L.O. 222 

Gas Storage 

The Consumers' Gas Company Ltd. 
Hillman Pool Unitization 

On March 10, 1987, an application was 
filed by Consumers Gas, Pembina Exploration 
and Devran Petroleum to join and regulate all 
interests in the Hillman Pool in the Township 
of Mersea, and to name Consumers Gas as 
the manager and operator of the pool. The 
application was heard in Windsor on 
October 20 and 21, and concluded in 
Toronto on October 22, 1 987. 

Three of the lessors adversely affected by 
the application intervened and were 
represented by counsel. They were awarded 
50 percent of their costs as assessed by the 
Board's Assessment Officer. Three other 
landowners who appeared were awarded 
$300 each. 

In a Decision with Reasons issued on 
December 23, 1987, the Board accepted the 
boundary of the pool as proposed, 
Consumers as designated manager and 
operator, and made unitization of the Hillman 
Pool retroactive to April 1 , 1 987. 

The Board also found that land 
compensation should be negotiated 
according to the estimated net income 
foregone as a result of lost production, 
provided that the amount was not less than 
$500 per acre per annum. The Board Order 
was issued February 12, 1988. 

E.B.O. 135 



Commission a juge que I'on devait accorder 
une aide financiere de 457 000 $ pour la 
construction. Union a presente a la 
Commission les documents indiquant que le 
gouvernement de I'Ontario avait approuve 
cette aide financiere. La demande a ere 
acceptee sous certaines conditions. 

E.B.L.O 222 

Stockage de gaz 

Exploitation concertee du gisement 
Hillman de Consumers' Gas Company 
Ltd. 

Le 10 mars 1987, Consumers Gas, 
Pembina Exploration et Devran Petroleum ont 
presente une demande afin de joindre et de 
reglementer les parties interessees au 
gisement Hillman, situe dans le canton de 
Mersea, et de nommer Consumers Gas en 
charge de la gestion et de I'exploitation du 
gisement. La demande a ete entendue a 
Windsor les 20 et 21 octobre et a Toronto le 
22 octobre 1987. 

Trois des bailleurs affectes par la demande 
etaient representes par leurs avocats. On leur 
a accorde la moitie de leurs couts, selon 
I'estimation faite par I'agent devaluation de 
la Commission. De plus, trois proprietaires 
fonciers ayant assiste a I'audience ont recu 
300 $ chacun. 

Dans sa decision, accompagnee de 
justifications et datee du 23 decembre 1 987, 
la Commission a approuve les limites du 
gisement proposees et la designation de 
Consumers pour la gestion et I'exploitation, et 
a juge que I'exploitation concertee du 
gisement etait retroactive au l er avril 1987. 

De plus, la Commission a juge que 
I'indemnisation fonciere devait etre negociee 
selon la perte de revenu net estime resultant 
de la baisse de production, si ce montant 
n'etait pas inferieur a 500 $ de I'acre par 
annee. L'ordonnance de la Commission a ete 
emise le 12 fevrier 1988. 

E.B.O. 135 




27 



Production Lines Jurisdictional Review 

By notice dated March 18, 1988, the 
Board invited interested parties to make 
written submissions to assist the Board in its 
review of the Board's jurisdiction under the 
Municipal Franchises Act. Specifically, the 
review will deal with the Board's jurisdiction 
over gathering/production pipelines located 
in municipal road allowances, which are 
used to convey locally produced natural gas. 

E.B.O. 146 

Tecumseh Gas Storage Rates 

Tecumseh Gas Storage Limited is a gas 
storage company jointly owned by 
Consumers Gas and Imperial Oil Limited. 

On April 21, 1987, Tecumseh applied to 
the Board for a rate increase largely 
necessitated by the discovery of a large 
volume of cushion gas missing from its 
storage pools. 

There were two main theories about the 
cause of the missing gas volumes: migration 
into the rock formation surrounding the 
storage pools; or the cumulative effects of 
measuring differences between gas volumes 
injected into, and gas volumes withdrawn 
from, storage. 

In its Decision, issued on September 4, 
1 987, the Board concluded that the evidence 
was not sufficient to allow it to determine the 
cause of the missing gas. Following a 
reopening of the hearing on March 14, 
1988, the Board issued an Addendum to its 
Decision (on April 13, 1988), requiring that 
Tecumseh remove 3.355 Bcf on a weighted 
average cost basis from its rate base since 
Tecumseh did not intend to purchase gas to 
replace the missing gas. 

E.B.RO. 434 

Tecumseh Gas Storage Designation of 
the Dow-Moore Pool 

By an application dated January 26, 
1 988, Tecumseh Gas Storage applied to the 
Board for a Regulation to designate as a gas 
storage area a depleted gas reservoir known 
as the Dow-Moore 3-21 -XII Pool (Dow-Moore 
Pool), situated in Moore and Sarnia 
townships. Tecumseh also requested an 
Order authorizing Tecumseh to inject gas 
into, store gas in, and withdraw gas from, the 
Dow-Moore Pool. 



Revue de la competence au sujet des 
pipelines de production 

Le 18 mars 1988, la Commission a emis 
un avis invitant les parties interessees a 
presenter leurs observations par ecrit dans le 
cadre de I'examen effectue par la 
Commission sur sa competence en vertu de 
la Loi sur les concessions municipales. 
L'examen portera sur la competence de la 
Commission en ce qui a trait aux pipelines 
de collecte/de production situes dans les 
emplacements municipaux affectes a une 
route et qui sont utilises pour transporter le 
gaz naturel local. 

E.B.O. 146 

Tarifs de stockage de gaz de Tecumseh 

Tecumseh Gas Storage Limited est une 
compagnie de stockage de gaz appartenant 
a Consumers Gas et a Imperial Oil Limited. 

Le 21 avril 1987, Tecumseh a presente a 
la Commission une demande d'augmentation 
de ses tarifs, la compagnie ayant decouvert 
que d'importantes quantites de gaz tampon 
avaient disparues de ses reservoirs de 
stockage. 

Deux theories ont ete proposees pour 
expliquer la disparition du gaz : la 
migration dans la formation rocheuse 
entourant les reservoirs de stockage; ou 
I'effet cumulatif resultant de la mesure des 
differences entre les volumes de gaz injectes 
et les volumes de gaz retires des reservoirs 
de stockage. 

Dans sa decision du 4 septembre 1987, 
la Commission a conclu que les preuves 
presentees ne permettaient pas d'expliquer la 
disparition du gaz. Apres la reouverture de 
I'audience le 14 mars 1988, la Commission 
a rendu public un addenda a sa decision le 
13 avril 1988, ordonnant a Tecumseh 
d'enlever 3,355 Bp^ de la moyenne 
ponderee des couts utilisee pour sa base 
devaluation puisque la compagnie ne 
prevoyait pas acheter de gaz pour remplacer 
le gaz disparu. 

E.B.RO. 434 



28 



Union Gas, a part owner of the pool, 
intervened. The application was set for a 
hearing commencing on April 5, 1988. 

E.B.O. 147 

Applications for Drilling Permits 

Union Gas Limited, R. G. Bryant 
Energy Associates, Payne Pool 

Applications were made to drill two wells 
into the Dundee formation in the Payne Pool 
designated gas storage area. A hearing was 
held on October 8, 1987, but was adjourned 
to obtain evidence that the petroleum and 
natural gas leases were still in effect. The 
hearing continued on November 7, 1987, 
when Union Gas filed evidence related to the 
leases. The two landowners affected by the 
applications had been notified and signified 
their consent to the well locations in writing. 

The applications were supported by Union 
Gas, the operator of the Payne Storage Pool. 
A report was issued on November 13, 1987, 
recommending that the permits be issued. 

E.B.R.M. 86 

L. M. Kodyen Zone Gas Storage Pool 

Oilfield brine resulting from Kodyen's 
current oil production from the Bothwell Pool 
is allowed to enter into surface drains or 
ditches. This method of surface disposal is 
being phased out by the Ministry of Natural 
Resources. 

The application was to drill a disposal well 
into the Lucas formation of the Detroit River 
Group. The Kodyen property is situated on 
the western side of the Bothwell Pool, but it 
also falls within the boundary of the Zone 
Pool, which is a designated gas storage area. 
A hearing was held on February 1 8, 1 988. 

The Board found that the well would not 
impair the integrity of the Zone Pool, and 
issued a report on February 23, 1988 
recommending that the application be 
approved as soon as possible. 

E.B.R.M. 87 



Designation du reservoir de stockage 
de gaz Dow-Moore par Tecumseh 

Le 26 Janvier 1988, Tecumseh Gas 
Storage a demande a la Commission 
d'emettre un reglement designant un reservoir 
de gaz epuise connu sous le nom de Dow- 
Moore 3-21 -XII (Reservoir Dow-Moore) et 
situe dans les cantons de Moore et de Sarnia, 
zone de stockage de gaz. Tecumseh a 
egalement demande remission d'une 
ordonnance I'autorisant a injecter et a stocker 
du gaz dans le reservoir Dow-Moore, et a en 
retirer. 

Union Gas, a qui appartient en partie le 
reservoir, s'est objecte. Une audience a ete 
prevue pour le 5 avril 1988. 

E.B.O. 147 

Demandes d'emission de permis de forage 
Union Gas Limited, R.G. Bryant 
Energy Associates, Reservoir Payne 

La Commission a recu des demandes pour 
le forage de deux puits dans la formation 
Dundee, dans la zone designee pour le 
stockage de gaz connue sous le nom de 
reservoir Payne. Une audience a eu lieu le 8 
octobre 1987 puis a ete ajournee afin 
d'obtenir la preuve que les concessions de 
petrole et de gaz naturel etaient toujours en 
vigueur. L'audience a repris le 7 novembre 
1987 apres que Union Gas a depose les 
preuves relatives aux concessions. Les deux 
proprietaires fonciers affectes par ces 
demandes avaient ete avises et ont accepte 
par ecrit I'emplacement du puits. 



29 



Union Gas Limited Dawn 167 Pool 

By 10 applications, each dated December 
22, 1987, Union Gas applied for permits to 
drill wells in the Dawn 167 Gas Storage 
Pool. The Board met with representatives of 
Union on March 3, 1988, to review the 
applications. 

The deliverability of the Dawn 1 67 Pool is 
lower than the average of Union's other 
storage pools. The proposed wells, together 
with a new NPS 10 pipeline, gathering lines 
and increased compression would enable 
Union to fully utilize the storage capacity of 
the Pool. All affected landowners were 
notified, and each signed letters of agreement 
concerning the locations of the proposed 
wells. 

The Board issued a Report on March 9, 
1988, recommending the granting of the 
permits, subject to conditions of approval. 

E.B.R.M. 88 

Municipal Franchise Agreements 

Model Municipal Franchise Agreement 

The Municipal Franchise Agreement 
Committee (MFA Committee), was appointed 
pursuant to the Report of the Board dated 
May 21, 1986, in the matter of the Board's 
review of franchise agreements and 
certificates of public convenience and 
necessity. 

On November 12, 1987, the MFA 
Committee submitted to the Board a model 
franchise agreement for implementation in 
Ontario. The standard terms and conditions 
contained in the model agreement are the 
result of extensive negotiations between the 
respective MFA Committee members 
representing the municipalities and the gas 
utilities in Ontario. 

The MFA Committee also produced a 
supplementary reference. The Franchise 
Handbook, describes the intentions and 
practices of the gas utilities with respect to 
construction activities in municipal road 
allowances. 

The model natural gas franchise 
agreement, now in use, applies to 
renegotiated agreements of expired 
franchises and to new franchises. It does not 
abrogate existing gas franchise agreements. 



Les demandes etaient appuyees par Union 
Gas qui exploite le reservoir de stockage 
Payne. Un rapport a ete rendu public le 13 
novembre 1987 recommandant que les 
permis soient accordes. 

E.B.R.M. 86 

Reservoir de stockage de gaz L.M. 
Kodyen 

On autorise I'infiltration de la saumure 
resultant de la production petroliere du 
gisement Bothwell de Kodyen dans les drains 
de surface et les fosses. Toutefois, le 
ministere des Richesses naturelles abanda/ine 
graduellement cette methode d'elimination. 

La demande portait sur le forage d'un 
puits de refoulement dans la formation Lucas 
du groupe de la riviere Detroit. La propriete 
Kodyen est situee du cote ouest du gisement 
Bothwell et dans les limites du reservoir Zone, 
qui est designe pour le stockage de gaz. 
Une audience a eu lieu le 1 8 fevrier 1 988. 

La Commission a juge que le puits ne 
nuirait pas au reservoir Zone et a publie son 
rapport le 23 fevrier 1988 recommandant 
I'approbation de la demande le plus tot 
possible. 

E.B.R.M. 87 

Reservoir Dawn 167 de Union Gas 
Limited 

Union Gas a presente dix demandes 
datees du 22 decembre 1987 pour 
I'emission de permis de forage de puits dans 
le reservoir de stockage de gaz Dawn 167. 
La Commission a rencontre les representants 
de Union le 3 mars 1988 pour revoir les 
demandes. 

La capacite de debit du reservoir Dawn 
1 67 est inferieure a la moyenne des autres 
reservoirs appartenant a Union. Grace aux 
puits proposes, a un nouveau pipeline NPS 
10, a de nouvelles conduites de collecte et a 
la hausse de la compression, Union pourrait 
optimiser la capacite de stockage du 
reservoir. Tous les proprietaires fonciers 
concernes ont ete avises et tous ont accepte 
par ecrit I'emplacement de ces puits. 

La Commission a publie un rapport le 9 
mars 1988 recommandant I'octroi des 
permis, sous certaines conditions. 

E.B.R.M. 88 



30 



The benefits of the model agreement are 
that: 

• it provides standard terms and 
conditions which would prevail, unless the 
Board was satisfied that to vary the terms and 
conditions in a particular case before the 
Board was in the public interest; 

• it restores confidence and trust between 
the parties by promoting certainty in the 
interpretation of franchise agreements and 
understanding of franchise terms; 

• it alleviates the unequal bargaining 
power in negotiations between a gas utility 
and a municipality of any size; 

• it avoids unnecessary discrimination 
between municipalities by providing consist- 
ency in franchise provisions among municipa- 
lities within each utility's franchised area, and 
between the franchised areas of the different 
utilities; and 

• it reduces costs to all parties involved by 
simplifying and expediting the franchise nego- 
tiation and approval processes. 

The Board is grateful to the members of the 
MFA Committee for their significant and far- 
reaching contribution to the improvement of 
gas franchise regulation and municipal and 
natural gas utility relations. 

E B.R.M. 88 

Franchise Approvals 

Inter-City Gas Corp., Township of 

Alberton 

On October 17, 1984, Inter-City Gas app- 
lied to the Board for permission to serve gas to 
the Corporation of the Township of Alberton. 
Shortly afterwards, Inter-City made an offer to 
purchase Northern & Central Gas Corporation 
Ltd., and it failed to proceed with the Alberton 
application. Facilities were constructed, 
however, and gas was supplied later in 1984. 

This situation came to the attention of the 
Board in 1987, during its consideration of a ref- 
erence from the Lieutenant Governor in Council 
for the transfer of Inter-City's assets in Ontario to 
ICG Utilities (Ontario) Ltd, E.B.R.L.G. 31. From 
the bench, on July 14, 1987, the Board app- 
roved the terms and conditions in the term of the 
franchise bylaw and agreements and declared 
that the consent of the municipal electors to the 
bylaw was not necessary. 

EBC447/EBC 151 



Ententes de concessions municipai.es 
modele o'entente de concession 
municipals 

Le comite charge des ententes de 
concessions municipales (comite ECM) a ete 
forme suite au rapport de la Commission date 
du 21 mai 1986 portant sur I'etude des 
ententes de concessions et les certificats 
d'installations de services publics. 

Le 12 novembre 1987, le comite ECM a 
presente a la Commission un modele 
d'entente de concession en vue de sa mise en 
application en Ontario. Les modalites et les 
conditions de I'entente sont le fruit 
d'importantes negociations entre les membres 
du comite ECM representant les municipality 
et ceux representant les compagnies 
ontariennes de services publics. 

Le comite ECM a egalement concu un 
guide de reference decrivant les buts et les 
pratiques des compagnies de services publics 
en ce qui a trait aux activites de construction 
dans les emplacements municipaux affectes 
aux routes. 

Le modele d'entente de concession de gaz 
naturel utilise a I'heure actuelle s'applique 
aux ententes renegociees regissant les 
concessions expirees et aux nouvelles 
concessions. II n'abolit pas les ententes de 
concession de gaz actuellement en vigueur. 

Les avantages du modele d'entente sont 
les suivants : 

• il offre des modalites et des conditions 
uniformes qui predominent, a moins que la 
Commission juge qu'il est preferable, dans 
I'interet public, de modifier ces modalites et 
conditions lors d'une cause precise; 

• il reinstaure un climat de confiance entre 
les parties car I'interpretation des ententes de 
concessions et de leurs conditions est claire; 

• il elimine I'inegalite lors des 
negociations entre les municipalites, quelle 
que soit leur importance, et les compagnies 
de services publics; 

• il elimine la discrimination inutile entre 
les municipalites en assurant I'uniformite des 
modalites des ententes de concessions 
conclues par les diverses municipalites au 
sein d'une meme region de concession et des 
ententes conclues entre les differentes regions 
de concession; et 



31 



Other Activities 

Natural Resource Gas Limited Rate 
Design 

On March 5, 1986, Natural Resource 
Gas Limited (NRG) applied to the Board for 
an order approving or fixing just and 
reasonable rates and other charges for the 
sale of natural gas. When filed, the 
application was not supported by pre-filed 
evidence and did not claim a revenue 
deficiency. NRG pre-filed evidence on May 
19, 1987, and submitted updates until June 
5, 1987. The hearing was held on June 8 
and 9, 1987. 

In its Decision with Reasons, dated 
September 1 5, 1 987, the Board found an 
allowable rate of return of 12.2% on a rate 
base of $2,529,609. 

e.b.r.o 416, e.b.r.o 397-b 

Sale of Inter-City Gas Corp. assets (the 
Fort Frances System) to ICG Utilities 
(Ontario) Ltd 

Inter-City Gas Corp. applied to the Board 
for leave of the Lieutenant Governor in 
Council to sell its Ontario distribution assets to 
ICG Utilities (Ontario) Ltd (ICG) in exchange 
for more than 20 percent of the Junior 
Preference Shares 1987 Series of ICG. 

The Board assessed the public interest 
implications of this application by considering 
the following: 

• the social contract which exists between 
the gas utilities and the Government; 

• the on-going regulation of the Ontario 
gas utilities by the Board; 

• undertakings by the utility and/or its 
parent and the enforcement of them; and 

• the free choice of individuals, 
corporations and institutions to invest, and to 
transfer investments, in Ontario gas utilities or 
holding companies of gas utilities. 

The hearing opened on April 7, 1987, 
and was adjourned to April 30 due to failure 
to comply with the Board's direction 
regarding publication of notice. The hearing 
was adjourned a second time to July 14, to 
allow time to complete the documentation 
supporting Inter-City's application to serve the 
Corporation of the Township of Alberton. 



• il reduit les couts que doivent payer les 
parties en simplifiant et en accelerant les 
negociations et le processus d'approbation. 

La Commission remercie les membres du 
comite ECM d'avoir contribue a 
I'amelioration de la reglementation des 
concessions de gaz et des relations avec les 
compagnies de gaz naturel et les 
municipalites. 

E.B.R.M. 88 

Approbation des concessions 
Inter-City Gas Corp., canton 
d'Alberton 

Le 1 7 octobre 1 984, Inter-City Gas a 
demande a la Commission I'autorisation de 
vendre du gaz a la corporation du canton 
d'Alberton. Peu apres, Inter-City a presente 
une offre pour I'achat de Northern & Central 
Gas Corporation Ltd., et n'a pas donne suite 
a sa demande. Cependant, les installations 
ont ete construites et le gaz a ete distribue a 
lafinde 1984. 

La Commission a pris connaissance de 
cette situation en 1987 lors de I'etude d'un 
renvoi de la part du lieutenant-gouverneur en 
conseil au sujet du transfert de I'actif d'lnter- 
City en Ontario a ICG Utilities (Ontario) Ltd., 
E.B.R.L.G. 31. Le 14 juillet 1987, la 
Commission a approuve les modalites et les 
conditions des ententes et du reglement 
relatifs aux concessions et a juge qu'il n'etait 
pas necessaire d'obtenir le consentement des 
electeurs municipaux. 

EBC447/EBC 151 

autres activites 

Elaboration des tarifs de Natural 
Resource Gas Limited 

Le 5 mars 1986, Natural Resource Gas 
Limited (NRG) a demande a la Commission 
d'emettre une ordonnance approuvant ou 
etablissant des tarifs justes et raisonnables 
pour la vente de gaz naturel. Lors du depot, 
la demande n'etait pas accompagne de 
documents preparatoires et ne mentionnait 
aucune insuffisance de recettes. NRG a 
depose les documents preparatoires le 19 
mai 1987 et des mises a jour jusqu'au 5 juin 
1987. L'audience a eu lieu les 8 et 9 juin 
1987. 

Dans sa decision, accompagnee de 
justifications et datee du 15 septembre 



32 



Issued to the Lieutenant Governor in 
Council on October 8, 1987, the Board's 
Report concluded that the proposed 
transaction, if conditioned by the Board's 
recommendations, was in the public interest. 
These recommendations dealt with: the rate 
zone treatment to be accorded these assets 
for cost allocation and rate making purposes; 
the accountability of ICG's controlling 
companies to the Ontario Energy Board; and 
the question of responsibility for the costs 
arising from this transaction. 

E.B.R.L.G. 31 

Sale of Gas in Ontario by Brokers; 
northridge petroleum marketing 
Inc., ATCOR Ltd., Brenda Marketing 
Inc., Enron Canada Ltd. 

During the fall of 1986, four brokers 
applied to the Board for certificates of public 
convenience and necessity to allow them to 
sell gas in Ontario. The applications were 
filed pursuant to the Municipal Franchises 
Act. The applicants requested certificates that 
would allow them to supply gas in all 
municipalities in Ontario. They also sought, 
as a term of the certificates, a declaration that 
they would not be required to obtain 
franchises to supply gas to these 
municipalities. 

In an Interim Decision with Reasons, the 
Board deferred final decisions on the 
applications, remarking that "the introduction 
of brokers as marketers in Ontario was an 
appropriate step", but that it "has reviewed 
the submissions of participants and has 
concluded that the subject was not 
adequately addressed to enable the Board to 
make a determination." 

The Board noted that until issuance of the 
Decision regarding contract carriage, dated 
March 23, 1987, various participants were 
uncertain if brokers would be permitted in 
Ontario at all. The Board found it important 
that all participants and other affected parties 
be given the opportunity to present 
submissions to assist the Board. 



1987, la Commission a juge que le taux 
de rendement acceptable etait de 12,2 
pour 100 et que la base devaluation 
etait de 2 529 609 $. 

ebro 416, e.b.r.o. 397-b 

Vente de l'actif d'Inter-City Gas Corp. 
(reseau de Fort Frances) a ICG 
Utilities (Ontario) Ltd 

Inter-City Gas Corp. a demande a la 
Commission I'autorisation du lieutenant- 
gouverneur en conseil afin de vendre a ICG 
Utilities (Ontario) Ltd (ICG) l'actif provenant 
de son reseau ontarien de distribution, 
obtenant en echange plus de 20 pour 100 
des actions privilegiees de second rang de la 
serie 1987 emises par ICG. 

La Commission a evalue les repercussions 
de cette demande sur I'interet public en 
tenant compte des points suivants : 

• le contrat social conclu par les 
compagnies de gaz et le gouvernement; 

• la reglementation des compagnies 
ontariennes de gaz effectuee par la 
Commission; 

• les engagements de la compagnie de 
services publics et de sa filiale de meme que 
leur mise a execution; et 

• le libre choix des particuliers, des 
compagnies et des institutions en matiere 
d'investissement et de transfert 
d'investissements affectant les compagnies 
ontariennes de services publics et les 
compagnies meres. 

L'audience a debute le 7 avril 1987 et a 
ete ajournee au 30 avril en raison du non- 
respect de la directive de la Commission 
regissant la publication de I'avis. L'audience 
a ete ajournee une seconde fois au 14 juillet 
afin de completer la documentation a I'appui 
de la demande presentee par Inter-City et 
visant a desservir la corporation du canton 
d'Alberton. 

Le rapport de la Commission a ete remis 
au lieutenant-gouverneur en conseil le 8 
octobre 1987. La Commission a conclu que 
la transaction proposee, si elle respectait les 
recommandations de la Commission, etait 
dans I'interet public. Les recommandations 
portaient sur : les zones de tarifs associees a 
cet actif pour la ventilation des couts et 
I'elaboration des tarifs; la responsabilite 



33 



By a procedural order dated June 8, 

1987, the Board invited all interested persons 
including utilities, municipalities, individuals, 
industries, associations, governments and any 
others, to make written submissions on the 
role of brokers and potential suppliers to 
Ontario customers, as well as submissions on 
the criteria and prerequisites to be applied in 
determining if a broker should be permitted to 
operate as a principal in the sale of gas. The 
submissions were filed with the Board by 
August 15, 1987. 

In its Decision with Reasons dated May 9, 

1988, the Board reiterated its support for the 
open and equal participation of brokers in 
the sale and resale of gas in Ontario. The 
Board found that province-wide certificates of 
public convenience and necessity should be 
issued to the applicants, subject to three 
conditions specified in the Decision. The 
Board noted that in accordance with the 
Municipal Franchises Act, the applicants 
would still require municipal by-laws 
approved by the Board. 

E.B.C. 177-180 

System Expansion Review 

On January 9, 1987, the Board issued a 
notice of its intent to conduct a review of the 
expansion of natural gas systems in Ontario. 
The Board invited interested parties to 
respond with written submissions in response 
to a Board staff discussion paper. Although 
this procedure of public participation had not 
been used by the Board, it had been 
successfully used in other jurisdictions to 
encourage participation of many parties who 
might not wish to incur the expense or invest 
the time required for an oral hearing. 

Twenty-five responses to the Board staff 
discussion paper were received. These 
responses were distributed to all participants, 
to provide them an opportunity to reply to 
each other's responses. Seven replies to 
these responses were received. A technical 
conference was held by Board staff on April 
6, 1987, to discuss matters arising from the 
responses and replies of participants. The 
conference extended over two days. The 
transcript of the conference and participants' 
submissions were submitted to the Board for 
consideration in reaching its decision. 



financiere des societes dominantes d'ICG 

devant la Commission de I'energie de 

I'Ontario; et les couts associes a cette 
transaction. 

E.B.R.L.G. 31 

Vente de gaz en Ontario par des 
courtiers; Northridge Petroleum 
Marketing Inc., ATCOR Ltd., Brenda 
Marketing Inc., Enron Canada Ltd. 

Au cours de I'automne 1986, quatre 
courtiers ont demande a la Commission 
d'emettre des certificats d'installations de 
services publics afin de leur permettre de 
vendre du gaz en Ontario. Les demandes ont 
ete presentees en vertu de la Loi sur les 
concessions municipales. Les requerants ont 
demande I'emission de certificats leur 
permettant de vendre du gaz dans toutes les 
municipalites de I'Ontario. lis ont egalement 
demande d'inclure parmi les conditions 
regissant les certificats, une declaration 
specifiant qu'ils ne seraient pas tenus 
d'obtenir de concessions pour vendre du gaz 
aux municipalites. 

Dans sa decision provisoire, 

accompagnee de justifications, la 
Commission a reporte sa decision finale, 
notant que la presence de courtiers sur le 
marche de la commercialisation etait une 
etape logique mais que la Commission, apres 
avoir etudie les observations des participants, 
ne possedait pas tous les renseignements 
necessaires lui permettant de prendre une 
decision. 

La Commission a precise qu'avant qu'elle 
ne rende sa decision du 23 mars 1987 sur 
les contrats de transport, les divers 
participants ne savaient pas si les courtiers 
recevraient les autorisations necessaires en 
Ontario. De plus, la Commission a juge que 
tous les participants et les autres parties 
concernees devaient pouvoir presenter leurs 
observations a ce sujet afin d'aider la 
Commission a prendre sa decision. 

La Commission a emis une ordonnance de 
procedure le 8 juin 1987 invitant tous les 
interesses, y compris les compagnies de 
services publics, les municipalites, les 
particuliers, les industries, les associations et 
les gouvernements a presenter leurs observa- 
tions par ecrit sur le role des courtiers et des 



34 



In the Decision, the Board noted that the 
concept of public interest is dynamic, and 
changes according to circumstances. It 
further noted that public interest is satisfied in 
the question of assessing system expansion 
when the welfare of the public is enhanced 
without imposing an undue burden on any 
individual group or class of customer. The 
Board noted that contributions in aid of 
construction should be required for projects 
when the sole purpose is to supply gas into a 
new area, and where an undue burden on 
existing customers would occur without a 
contribution. 

The Board stated that economic feasibility 
is an important criterion that should be 
examined, and it directed the utilities to 
employ certain tests in assessing the 
economic feasibility of projects being 
considered for system expansion. 

EBO 134 



autres fournisseurs, et sur les conditions et les 
criteres prealables devant etre utilises pour 
determiner si un courtier peut vendre du gaz 
a son compte. Les observations ont ete 
deposees pour le 15 aout 1987. 

Dans sa decision, accompagnee de 
justifications et datee du 9 mai 1988, la 
Commission a reitere son appui a la libre 
participation des courtiers a la vente et a la 
revente de gaz en Ontario. La Commission a 
conclu que des certificats d'installations de 
services publics valides pour toute la province 
devraient etre accordes aux requerants, 
certificats sujets a trois conditions specifiees 
dans la decision. La Commission a precise 
que, conformement a la Loi sur les 
concessions municipales, les requerants 
devraient toujours obtenir I'autorisation des 
municipality sous forme de reglements 
approuves par la Commission. 

E B.C. 177-180 

Etude du prolongement du reseau 

Le 9 Janvier 1987, la Commission a emis 
un avis d'intention annoncant la realisation 
d'une etude du prolongement des reseaux de 
gaz naturel en Ontario. La Commission a 
invite les parties interessees a commenter par 
ecrit un document de travail de la 
Commission. Meme si la Commission avait 
recours a ce type de participation publique 
pour la premiere fois, on avait montre qu'il 
encourageait la participation de plusieurs 
parties qui, autrement, n'engageraient peut- 
etre pas les couts ou ne prendraient pas le 
temps necessaires a une audience. 

La Commission a recu vingt-cinq reponses 
au document de travail. Elles ont ete 
redistributes a tous les participants pour 
qu'ils y repondent. La Commission a recu 
sept autres reponses suite a cette distribution. 
Le personnel de la Commission a organise 
une conference technique le 6 avril 1987 
pour discuter des questions soulevees par les 
reponses des participants. La conference a 
dure deux jours. Le compte-rendu de cette 
conference et des observations des 
participants ont ete presentes a la 
Commission pour decision. 

Dans sa decision, la Commission a 
indique que le concept de Pinteret public est 
dynamique et varie selon les circonstances. 



35 



Costs Awards 

In 1985, a generic hearing was held to 
review the matter of awarding costs to 
participants in Board hearings. At issue was 
the need to encourage broad participation in 
hearings and to assist participants in 
providing high quality evidence. 

The Board decided on procedure for 
determining cost awards involving a panel to 
hear applications from intervenors. During the 
year in review, the Board awarded costs to 
the following intervenors : 

H.R. 15 

Mr. Arnold Earl 

The Association of Major Power 

Consumers of Ontario 

The Municipal Electric Association 

Energy Probe 

E.B.R.O. 410-11, E.B.R.O. 411-11, E.B.R.O. 412-11 

The Industrial Gas Users Association 

C-l-L Inc. 

The City of Kitchener 

Nitrochem Inc. 

Energy Probe 

Polysar Ltd. 

H.R. 16 

Mr. Arnold Earl 

The Society of Ontario Hydro Professional 
and Administrative Employees 
The Association of Major Power 
. Consumers of Ontario 
Independant Power Producers' Society of 
Ontario 

The Municipal Electric Association 
Energy Probe 

E.B.R.O. 429 

The Industrial Gas Users Association 
C-l-L Inc. 

E.B.R.O. 430 

Nitrochem Inc. 

E.B.R.O. 434/414-111 

The Industrial Gas Users Association 
Mrs. Mary Yaki 
Mr. Archiel Kimpe 



Elle a ajoute que revaluation du 
prolongement des reseaux est dans Pinteret 
public puisque le bien-etre de la population 
est accru et ce sans nuire a un groupe de 
particuliers ni a une categorie de 
consommateurs. La Commission a precise 
qu'une aide financiere devrait etre accordee 
aux projets de construction qui visent 
uniquement a approvisionner un nouveau 
marche en gaz et lorsque les consommateurs 
seraient penalises si cette aide financiere 
n'etait pas accordee. 

La Commission a declare que la faisabilite 
economique est un critere important qui doit 
etre etudie et a demande aux compagnies de 
services publics d'evaluer la faisabilite 
economique des projets entrainant le 
prolongement des reseaux. 

EBO 134 

Remuneration des participants 

En 1985, la Commission a tenu une 
audience generale afin d'etudier la 
remuneration des participants aux audiences de 
la Commission afin de favoriser cette 
participantion et d'aider les intervenants a 
presenter des preuves de qualite. 

La Commission a decide de former un comite 
charge d'etudier les demandes presentes par les 
intervenants et la remuneration des participants. 
Au cours de I'exercice, la Commission a 
remunere les intervenants suivants : 

H.R. 15 

M. Arnold Earl 

The Association of Major Power Consumers 

of Ontario 

Enquete Energetique 

The Municipal Electric Association 

E.B.R.O. 410-11, E.B.R.O. 411-11, E.B.R.O. 412-11 

LAssociation des consommateurs industriels 

de gaz 

C-l-L Inc. 

La Ville de Kitchener 

Nitrochem Inc. 

Enquete Energetique 

Polysar Ltd. 

H.R. 16 

M. Arnold Earl 

La Societe des employes professionnels et 

administratifs de L'Hydro-Ontario 

The Association of Major Power Consumers 

of Ontario 



36 



Independant Power Producers' Society of 

Ontario 

La Municipal Electric Association 

Enquete Energetique 

E.B.R.O. 429 

['Association des consommateurs 
industriels de gaz 
C-l-L Inc. 

E.B.R.O. 430 

Nitrochem Inc. 

E.B.R.O. 434/414-111 

['Association des consommateurs 
industriels de gaz 
Mme Mary Yaki 
M. Archiel Kimpe 



37 



Glossary 

Argument: The final step in a hearing, during which 
participants summarize their positions on various matters of 
concern based on the evidence adduced. 

Bcf: An abbreviation for a billion cubic feet of gas, 
which is equivalent to 28.328 million cubic metres. 

Board Order: A legal document directing the 
implementation of a Board decision. An order is binding 
on the indicated parties. 

Board Recommendations: Usually contained in a Board 
Report to a Minister, or to the Lieutenant Governor in 
Council, on Ontario Hydro or some other energy-related 
matter. Such recommendations are not binding except in 
matters set out under Section 23 of the Ontario Energy 
Board Act. 

Bulk Power Rates: Wholesale electricity rates to 
municipalities and certain industrial customers of Ontario 
Hydro having an average annual power demand of 5,000 
kilowatts or more. 

Buy/Sell Agreement: Arrangement whereby an end- 
user purchases gas from a producer and then sells it to the 
local distribution utility which comingles that gas with other 
supplies. The end-user then buys gas from the local utility in 
the usual manner. The difference between the price paid to 
the producer and the price received from the local utility, 
minus any transportation costs, accrues to the end-user. 

Bypass: Bypass involves the total avoidance of the 
Local Distribution Company's system for the transportation 
of gas. 

CMP: Competitive Marketing Program. 

Commodity Charge: A charge per unit volume of gas 
actualy taken by the purchaser, as distinguished from a 
demand charge which is based on the maximum volume a 
buyer has the right to take though no gas is taken in a 
given period. 

Contract Carriage: Transportation service provided for 
the transport of gas not owned by the transporting pipeline 
company. (See also T-Service.) 

Contract Demand: Gas which a utility or a customer 
has the contractual right to demand on a daily basis from 
the supplier of the gas. 

- Demand Charge: A monthly charge which normally 
covers the fixed costs of the system. The demand charge is 
based on the daily contracted volume and is payable 
regardless of volumes taken. 

Designated Gas Storage Area: A land area containing 
geological formations into which the Board may authorize 
a person to inject, store and remove gas. Injection of gas 
for storage into any geological formation outside of a 
designated gas storage area is prohibited under Section 
20 of the Ontario Energy Board Act. 

Direct Sales: Natural gas supply purchase 
arrangements transacted between producers and end-users 
at negotiated prices for which pipeline transportation 
arrangements must then be negotiated separately with 
Trans Canada Pipe Lines and the local distribution utility, 

Gigajoule: A measure of energy content in fuel. A 
typical residential consumer of gas might use about 1 30 
gigajoule (GJ) per year for household heating. (0.95 
million cubic feet of natural gas contains approximately 
one GJ of thermal energy) 

Interrogatories: Written requests for the supply of 
additional information, or clarification of information 
already received. 

Intervention: Notice of intent to participate in hearings, 
stating the interest in the proceeding. The person or group 
is called an intervenor. 

Ontario Pipeline Coordination Committee (OPCCj: An 
interministerial committee, chaired by a member of the 
OEB staff, and including designates from those ministries 
of the Ontario Government which collectively have a 
responsibility to ensure that pipeline construction and 
operation have minimum undesirable impacts on the 
environment. The environment, perceived in a broad sense, 
covers agriculture, parklands, forests, wildlife, water 
resources, social and cultural resources, public safety, and 
landowner rights. 



Lexique 

Base devaluation : Montant investi par une entreprise 
de services publics dans les biens utilises pour dispenser 
les services, moins I'amortissement cumule, plus le montant 
consacre au fonds de roulement et tout autre poste retenu 
par la Commission. La base devaluation ne doit pas 
comprendre les impots sur le revenu reportes et cumules. 

Bp3 : Abreviation designant un milliard de pieds 
cubes de gaz, soit I'equivalent de 28,328 millions de 
metres cubes metriques. 

Comite ontarien de coordination des pipelines (COCPj 
: Comite interministeriel preside par un membre de la 
Commission de I'energie de POntario et forme de 
representors des ministeres du gouvernement de TOntario 
qui vise a minimiser les repercussions environnementales 
de la construction et de I'exploitation de pipelines. On 
entend par repercussions environnementales I'incidence sur 
I'agriculture, les pares, les forets, la faune, les ressources 
aquatiques, sociales et culturelles, la securite du public et 
les droits des proprietaires fonciers. 

Contrat d'achat et de vente : Control en vertu duquel 
un utilisateur final achete du gaz aupres d'un producteur 
puis le vend a une compagnie de distribution qui melange 
ce gaz a d'autres produits pour la distribution. L'utilisateur 
final achete ensuite du gaz aupres de la compagnie locale 
de la facon habituelle. La difference entre le prix paye au 
producteur et le prix demande par la compagnie locale, 
moins les frais de transport, revient a l'utilisateur final. 

Contrat de transport : Service offert pour le transport 
du gaz qui n'appartient pas a la compagnie de transport 
par pipeline (Voir Service T). 

Demande contractuelle Quantite de gaz que 
I'entreprise de services publics et les consommateurs ont 
droit d'exiger quotidiennement, en vertu d'un contrat, de la 
part du fournisseur de gaz. 

Evitement : Non utilisation du reseau de la compagnie 
locale de distribution pour le transport du gaz. 

Exercice de reference : Periode de douze mois 
consecutifs (d'ordre general, le prochain exercice financier 
de I'entreprise) pour laquelle on prevoit les revenus, les 
couts, les depenses et la base devaluation qu'etudie la 
Commission afin d'etablir les tarifs qui permettront a 
I'entreprise de services publics d'obtenir un rendement 
adequat. 

Exigences relatives aux revenus : Depenses permises 
de I'entreprise de services publics, y compris le rendement 
permis de la base devaluation, que I'entreprise doit 
recuperer par I'entremise de ses tarifs afin d'amortir les 
couts de service. 

Frais lies a la demande : Frais mensuels qui couvrent 
generalement les couts du reseau. Les frais lies a la 
demande sont bases sur le volume quotidien prevu au 
contrat et doivent etre acquittes quel que soit le volume de 
gaz utilise. 

Frais lies au produil : Frais percus pour chaque unite 
de gaz achetee. lis different des frais lies a la demande 
qui sont bases sur le volume maximal qu'un acheteur a le 
droit de prendre, bien qu'aucune quantite de gaz ne soit 
utilisee pendant cette periode. 

Gaz distribue : Gaz distribue par les producteurs en 
vertu d'un contrat conclu avec TCPL. 

Gigajoule : Unite de mesure du contenu energetique 
des combustibles. Un consommateur residentiel utilise 
environ 1 30 gigajoules (GJ) par annee pour chauffer sa 
residence. (0,95 million de pieds cubes de gaz naturel 
contient environ 1 GJ d'energie thermique.) 

Intervention : Avis d'intention de participer a une 
audience indiquant les raisons de cette participation. La 
personne ou le groupe qui participe a cette audience porte 
ie nom d'intervenant. 

Ordonnance de la Commission : Document juridique 
regissant la mise a execution d'une decision de la 
Commission. Les parties concernees doivent se conformer 
a ladite ordonnance. 

Plaidoirie : Etape finale de I'audience au cours de 
laquelle les participants resument leur position face aux 
diverses questions soulevees d'apres les preuves 
presentees. 



38 



Rate Base: The amount that a utility has invested in 
assets that are used or that are useful in providing service, 
minus accumulated depreciation, plus an allowance for 
working capital and any other items which the Board may 
determine. Rate base may also be net of accumulated 
deferred income taxes. 

Rate of Return on Common Equity: Utility income, after 
tax, expressed as a percentage of the amount of common 
equity approved for inclusion in the utility's capital 
structure. 

Rate of Return on Rate Base: The utility income, after 
tax, which a utility is allowed to earn expressed as a 
percentage of the rate base. Note that this return is not 
guaranteed to the utility. Rather, this is the return that the 
company has a reasonable opportunity to earn given 
forecast conditions. 

Revenue Requirement: The allowed expenses of the 
utility, including the allowed return on rate base, which the 
utility must recover through rates in order to cover its costs 
of providing service. 

System Gas: Gas supplied under contract to TCPL by 
gas producers. 

Test Year: A prospective period of twelve consecutive 
months (usually the company's next full fiscal year) for 
which projections of revenues, costs, expenses and rate 
base are studied by the Board in order to set rates which 
will allow the utility the opportunity to earn a reasonable 
rate of return 

T-Service: The gas transportation service offered by a 
pipeline company or distributor to transport gas owned by 
others. (See also 'Contract Carriage'.) 

Unbundled Rate: A rate for an individual, separate 
component of service offered by a distributor, as opposed 
to a rate which combines the costs of a variety of 
component services. 



Questionnaires : Demande ecrite pour la presentation 
de renseignements additionnels ou la clarification de 
certains renseignements. 

Recommandations de la Commission : Generolement 
contenues dans un rapport de la Commission presente a 
un ministre ou au lieutenant-gouverneur en conseil et 
portant sur Ontario Hydro ou une autre question liee au 
domaine energetique. Les parties concernees ne sont pas 
obligees de se conformer a ces recommandations sauf 
dans les circonstances prescrites a I'article 23 de la Loi 
sur la Commission de Penergie de I'Ontario. 

Rendement de la base devaluation : Revenus nets 
permis de I'entreprise de services publics, exprimes en 
pourcentage de la base devaluation. Ce rendement n'est 
pas garanti mais correspond au rendement auquel 
I'entreprise peut s'attendre compte tenu des conditions 
prevues. 

Rendement des actions ordinaires : Revenus nets de 
I'entreprise de services publics exprimes en pourcentage 
du montant des actions ordinaires qui sera inclus dans la 
structure du capital. 

Separation des Tarifs : Tarif impose pour une partie du 
service offer) par un distributee, par opposition au tarif 
comprenant le cout de diverses composantes d'un service. 

Service T : Service offert par une compagnie de 
pipelines ou par un distributee pour le transport du gaz 
appartenant a une autre compagnie. (Voir Contrat de 
transport) 

Tarifs de vente d'electricite en gros : Tarifs de vente 
d'electricite en gros imposes par Ontario Hydro aux 
municipalites et a certaines industries qui consomment en 
moyenne 5 000 kilowatts et plus par annee. 

Ventes direcles : Entente d'approvisionnement en gaz 
naturel a un prix determine conclue entre le producteur et 
Putilisateur final. Le transport par pipelines doit etre 
negocie avec TransCanada Pipelines et avec I'entreprise 
locale de distribution. 

Zone designee pour le stockage de gaz : Zone qui, en 
raison de sa formation geologique, est choisie par la 
Commission pour I'injection, le stockage et I'utilisation de 
gaz. En vertu de I'article 20 de la Loi sur la Commission 
de Penergie de I'Ontario, il est interdit de stocker du gaz 
dans une formation geologique qui n'est pas situee dans 
une zone designee pour le stockage de gaz. 



39 



The Ontario Energy Board is located at 

Maple Leaf Mills Tower, 

2300 Yonge Street, 

Suite 2601, 

Toronto, Ontario 

(416)481-1967 



Copies of this and other Board publications may be 
purchased from the Ontario Government Bookstore, 880 
Bay Street, Toronto. Telephone (416) 965-2054 
Out-of-town customers please contact The Ministry of 
Government Services, Publications Services Section, 5th 
Floor, 880 Bay Street, Toronto, Ontario M7A 1N8. 
Telephone (416) 965-6015. Toll free long distance: 1-800- 
268-7540. Northwestern Ontario: 0-Zenith 67200. 



Les bureaux de la Commission de Penergie de I'Ontario 

sont situes a la 

Tour Maple Leaf Mills , 

2300 rue Yonge, 

Bureau 2601, 

Toronto, Ontario 

(416)481-1967 

Des exemplaires du present rapport et d'autres 
publications de la Commission sont disponibles a la 
librairie du gouvernement de I'Ontario au 880, rue Bay, 
Toronto (416) 965-2054. 

Les personnes habitant a I'exterieur de Toronto peuvent 
communiquer avec le Service des publications, ministere 
des Services gouvernementaux, 880, rue Bay, 5 e etage, 
Toronto (Ontario) M7A 1N8 (416) 965-6015. Pour les 
appels interurbains sans frais, composez le 1-800-268- 
7540 et dans le Nord-Ouest de I'Ontario, appelez le 0- 
Zenith 67200. 



ISSN 0317-4891 



ISSN 0317-4891 



Field photographs courtesy of 
Consumers Gas 
Ontario Hydro 



Photographies prises sur le terrain par 
Consumers Gas 
Ontario Hydro 



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